Regulatory Updates October 2026

Our regulatory newsletter aims to provide insight into the changes and updates that may have an impact on firms. At Objectivus, we are well positioned to provide context and support for firms working to understand such changes.

In this issue: the FCA’s review of conflicts of interest in private markets, proposed redemption rules for illiquid retail funds, the revoked LIBOR/EURIBOR bans and recent FCA enforcement outcomes.

 

Private market conflicts of interest

On 23 October, the FCA published its multi-firm review of how private equity, private credit and real estate firms identify, manage and disclose conflicts of interest.

It noted that private markets can give rise to conflicts that differ from those in public markets. Disclosure matters, but the FCA’s rules treat it as a last resort, not a substitute for arrangements that prevent or manage the conflict.

It found examples of good practice, including strong governance arrangements, effective oversight and independent challenge.

It also found examples of poor practice, where firms were failing to identify conflicts adequately or keep their controls up to date. Particular areas singled out included cross-fund transfers and multi-party transactions, gifts and entertainment, and information barriers.

What this means for firms. Firms should check that their conflicts register reflects what the business does today rather than a generic list, and that governance records show real challenge on material conflicts, particularly cross-fund transactions. The FCA has said it will do further work in this area, so expect follow-up over the next six months.

 

Proposed redemption rules for illiquid retail funds

On 8 October, the FCA announced in a press release that it is consulting (CP26/35) on minimum redemption terms for retail funds that invest mainly in illiquid assets such as property.

Non-UCITS Retail Schemes (NURS) with at least 50% of the value of scheme property in inherently illiquid assets would have a minimum 90-day notice period for redemptions and no more than one redemption dealing day a month. The rules would also apply to investors who are indirectly exposed to these funds through pension or savings wrappers or life assurance policies.

The aim is to ensure that a fund’s redemption terms reflect the time it typically takes to sell illiquid assets like real estate in the portfolio.

What this means for firms. The FCA expects relatively few funds to be caught, mainly direct property funds and some funds of alternative investment funds. Managers of those funds should check their portfolios against the 50% threshold now and start reviewing dealing arrangements, prospectus disclosures and how the funds are offered through pension, savings and life wrappers.

Responses are due by 11 December 2026 using the FCA’s response form.

 

FCA revokes LIBOR/EURIBOR prohibitions

On 7 October, the Court of Appeal overturned the convictions of Jonathan Mathew, Jay Merchant, Alex Pabon, Philippe Moryoussef and Colin Bermingham following the Supreme Court’s July 2025 judgment on the cases of Tom Hayes and Carlo Palombo. Two days later, Christian Bittar, who had pleaded guilty to conspiracy to defraud, also had his conviction overturned.

On 16 October, the FCA revoked the bans it had imposed on four of these individuals (Colin Bermingham, Philippe Moryoussef, Jonathan Mathew and Christian Bittar), because the bans rested on the convictions now overturned. It has removed the associated Final Notices and will take no further action against them. This follows its decision last year to discontinue proceedings against Hayes and revoke Palombo’s ban.

 

FCA enforcement outcomes

The FCA banned Jeffrey Dawkins, the former CEO of Vector Wealth Ltd, and fined him nearly £270,000. After selling the firm to a disqualified director, he continued to present himself as CEO, which gave the new owner cover to sell high-risk mini-bonds through the firm.

Kadir Kanizi, a former senior manager at Vector Wealth, has also been fined £20,000 and banned from senior management roles. He promoted the bonds without properly explaining the risks to investors.

Kerry Nelson and Jacqueline Stephens of Nexus Independent Financial Advisers Limited have pleaded guilty to fraud in a prosecution brought by the FCA and will be sentenced on 10 December 2026 at Portsmouth Crown Court.

Both admitted defrauding clients of £2m between January 2019 and January 2023 and using false documents as part of the fraud. Nelson also admitted a money laundering offence relating to money withdrawn from the firm.

Finally, the FCA has restricted six lenders, known as Annex 1 firms, which are registered with the FCA for money laundering supervision but not authorised under FSMA, over concerns about anti-money laundering (AML) controls.

The firms agreed to the restrictions as voluntary requirements. They limit their ability to take on new customers or do new business with existing customers, including extending existing credit.

What this means for firms. Registration is not light-touch supervision. Annex 1 firms should expect the FCA to test their AML controls and should be able to evidence that those controls work.

 

If you have any questions or would like further clarity on any of the points raised, please contact us at info@objectivus.com.