The Financial Conduct Authority is calling for third-party compliance consultants to set clearer boundaries with clients and uphold high standards during the authorisations process.
Speaking at the APCC Spring Conference 2026 in London today (April 22), Sheree Howard, executive director of authorisations at the FCA warned that firms must be able to explain their own business models “in their own words”.
She said: “Getting authorised is more like a marathon than it might seem. Filled with documents, deadlines and — let’s be honest — a fair amount of adrenaline, it can feel like that final sprint down the Mall for many firms as they reach the end.
“And you are their support system, helping them get authorisation-ready. That preparation genuinely matters. Because gaining the right to be a regulated financial services firm isn’t easy. Nor should it be.”
The regulator welcomed the role consultants play in helping firms prepare stronger applications.
Howard said consultants were valuable in “identifying gaps, stress-testing their governance, sharpening their documentation and helping them understand the regulations”.
Sometimes, it means having the hard conversations — like telling your clients they aren’t yet ready
She added that “when firms come to us well-prepared”, the process “works best, and firms get through the process quickly and smoothly”.
But Howard stressed that the authorisation bar would remain high, arguing that “getting authorised is hard — but rightly so”.
“Clean markets aren’t an abstract idea. They’re how we protect consumers, support confidence and encourage investment and growth. So, standards have to be high. And we have to uphold them.
A back seat
Howard used her speech to caution consultants against overstepping during FCA interviews and meetings, stating the regulator needed to assess the firm’s own competence.
“You are welcome in the room, but your client must be able to speak for themselves — and explain their business model and operations clearly, in their own words,” she said.
“We can spot when a consultant has become the dominant voice in an application, whether in emails, meetings or interviews. And where we do, we’ll address it directly with the firm’s senior management.”
She described one recent case where a consultant attended an interview but “began prompting the firm” and “even appeared to be coaching them by instant message”.
“We could no longer tell whose knowledge, skills and experience we were hearing about — the firm’s, or the consultant’s,” she said.
“So we stopped the interview and rescheduled. The firm did perform well at the follow-up call and was approved — but a month later than necessary, and under far more stress than they should’ve faced.”
‘Good judgment’
Howard also told compliance consultants they had a role in telling firms when they were not yet ready to apply.
“Sometimes, it means having the hard conversations — like telling your clients they aren’t yet ready,” she said.
Howard said withdrawal “shouldn’t be seen as a sign of failure”, but instead as “showing good judgment, taking the space to regroup, and — most importantly — coming back stronger”.
She also pointed to several FCA support measures aimed at helping firms prepare earlier, including the pre-application support service (Pass) for targeted support, launched in August 2025.
“The first two firms were authorised on day two of the regime,” she said. “Not bad, considering day one was a bank holiday.”
Another is the appointed representatives regime as an entry point for smaller firms, where she said the FCA was preparing firms for the incoming crypto regime through webinars and pre-application support.
She also flagged the incoming regulation of buy now, pay later, which becomes regulated on July 15.
Speaking directly to consultants, Howard concluded that the FCA’s authorisation process is “demanding” and “it’s meant to be”, she said.
“But for firms that come prepared — and with the right support behind them — it doesn’t have to be agony. That’s what we’re asking of you: Be the support firms need, when they need it.
“By setting boundaries, holding your clients to high standards — even when it’s difficult — and taking the long view.”
sonia.rach@ft.com
