Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what discussions he has had the Financial Conduct Authority on the collapse of Blackmore Bond.

HM Treasury works closely with the FCA to maintain a strong and safe financial system. Treasury Ministers and officials regularly meet with the FCA to discuss a variety of matters.

The FCA does not have power to investigate a firm that is unauthorised and not carrying out regulated activities. Where problems fall outside the FCA’s statutory remit, they assist other agencies and regulators wherever they can. As Blackmore Bond was an unregulated firm, the FCA passed the relevant information to the City of London Police.

In November 2019, the FCA temporarily banned the promotion of high-risk ‘speculative illiquid securities’ to ordinary retail investors. This ban covers the type of mini-bonds sold by Blackmore Bond. This ban was made permanent in January 2021.

In April 2021, the Treasury launched a consultation on proposals for bringing mini-bonds within the scope of regulation. On 1 March 2022 the Treasury set out its intention to include non-transferable securities, including mini-bonds, within the scope of the Prospectus Regime Review. Issuers of mini-bonds would be required to offer their securities via a platform which would ensure appropriate due diligence and disclosure and be regulated by the FCA.