Financial Services and Markets Bill [Lords]

Phil Brickell Excerpts

Tuesday 10th November 2026 Commons Chamber

[Phil Brickell (Bolton West) (Lab)]

As a former banking employee, let me be clear that a strong financial regulatory system and strong economic growth are not competing objectives. If Britain is to remain one of the world’s leading financial centres, we must ensure that it is not also one of the world’s preferred destinations for dirty money.

As the chair of the APPG on anti-corruption and responsible tax, I have consistently worked with colleagues, including my hon. Friend the Member for Kensington and Bayswater (Joe Powell), to strengthen the UK’s response to economic crime. After a number of meetings with the Economic Secretary to the Treasury and her predecessors, I am pleased to see that she has taken up the cudgel of anti-money laundering supervisory consolidation—that is a bit of a mouthful. That matters, because those who wish to subvert our financial and professional services sectors, launder their ill-gotten gains and drag down the UK’s reputation as a clean place to do business will always seek to exploit the weakest point in our regulatory and supervisory armour. To that end, I am proud to support the Bill, which will modernise the way in which the legal and accountancy sectors, and trust and company services providers, are supervised for money laundering risk, with those responsibilities consolidated within the Financial Conduct Authority.

Working in the industry, it always baffled me that anti-money laundering oversight is currently divided among 22 professional body supervisors, many of which are also membership organisations. That creates an inherent conflict of interest—it leads to inconsistent supervision, variable enforcement, fragmented intelligence sharing and uneven suspicious activity reporting. The Office for Professional Body Anti-Money Laundering Supervision’s March 2026 progress report perfectly sums up the situation, stating that professional body supervisors

“still report common breaches…and no or inadequate firm-wide risk assessment by their supervised population.”

The FCA itself is not immune to this; it only took seven formal actions in the period 2024-25, down from a pre-pandemic high of 60 in 2018-19. The total number of on-site visits conducted by all 22 professional body supervisors has not yet returned to pre-pandemic levels.

Economic crime is not victimless—it fuels corruption, organised crime, fraud and kleptocracy. It distorts markets, undermines competition and damages Britain’s international reputation. That is why clause 13, which deals with supervisory consolidation, is so important. By ending the fragmented system of 22 separate professional body supervisors and moving towards a single supervisory model for those sectors under the remit of the FCA, this Government are taking a significant step forward. There are three important opportunities to further enhance the Bill that I would be grateful if the Economic Secretary to the Treasury would consider.

First, we need a sustainable solution to the chronic underfunding of economic crime enforcement. The anti-corruption APPG has long called for the creation of an economic crime fighting fund. The principle is straightforward: a proportion of receipts from economic crime enforcement, including confiscated assets, penalties and deferred prosecution agreement receipts, should be reinvested into the very agencies responsible for tackling those crimes. Rather than allowing enforcement proceeds simply to disappear into the consolidated fund, we should create a virtuous circle in which successful enforcement generates additional capability for future enforcement.

The Government’s 2025 anti-corruption strategy promised to explore the funding landscape for strengthening economic crime enforcement, and I think something could be done within the framework of this Bill. The FCA has secured more than £1 billion in regulatory and criminal fines over the past decade, yet enforcement receipts are largely either returned to the industry through rebates or transferred to the Treasury. I understand that the banks are paying their way via the economic crime levy, so I do not begrudge the principle of rebates, but as the Government are now legislating for the FCA to take on growing responsibilities in the face of increasingly sophisticated criminal threats, I encourage the Treasury to consider allowing the FCA to offset the costs of AML enforcement with the fines it imposes for breaches. The Competition and Markets Authority, Ofcom and the Information Commissioner’s Office already possess comparable powers. Giving the FCA similar flexibility would allow it to invest in specialist expertise, advanced technology and enforcement capability, thereby ensuring that it has the cutting-edge capabilities it needs to effectively police the regulated perimeter.

Secondly, the Government must ensure that the current supervisors do not take their eye off the ball during the transition period.

Finally, I urge the Government to ensure that legal sector regulation works effectively under the new regime. At present, there remains a significant problem concerning access to legally privileged material. When the Bill was in the Lords, Ministers confirmed that the FCA will not have powers to compel disclosure of privileged material, yet recent litigation involving the Solicitors Regulation Authority has exposed serious uncertainty regarding regulators’ ability to access such information when investigating misconduct. That litigation should prompt a rethink. If the FCA inherits the same limitations, there is a real risk that serious wrongdoing by solicitors involved in money laundering or abusive litigation practices will remain beyond effective scrutiny. The Bill should therefore clarify that the regulator can access legally privileged material where necessary for the purposes of anti-money laundering supervision, while continuing to protect clients’ rights and confidentiality.

I support the Government, and I trust that my right hon. and learned Friend the Economic Secretary to the Treasury will reflect on my constructive proposals as the Bill progresses through this place.