The PRA’s statutory powers and enforcement

The Prudential Regulation Authority (PRA) has a variety of enforcement and other formal powers.

This page was produced before the UK’s withdrawal from the EU. The UK has now entered into a transition period, due to end on 31 December 2020, during which EU law will continue to apply. We will update this page at a later date, as appropriate, to reflect the legal and regulatory framework applicable at the end of the transition period.

What is enforcement? 

If a firm or individual fails to comply with relevant requirements, we can take action. This could be by way of imposing a financial penalty or public censure, for example. We can also prohibit an individual from working in the regulated financial services sector. 

This way we clearly set out, for the benefit of the whole regulated community, the actions we consider unacceptable.  

How do we exercise our investigation and enforcement powers?

Our approach documents explain what we expect of authorised firms and how we use our powers. 

Before taking disciplinary action against a firm or an individual, we usually investigate whether (and if so, which) regulatory requirements have been breached. We have published our approach to enforcement, which includes statements of policy and procedure relating to:

  • statutory notices and decision making
  • financial penalties
  • suspensions and restrictions
  • settlement
  • publicity of regulatory action
  • conduct of interviews pursuant to section 169(7) of the FSMA.

For more information on the Bank’s Statement of Policy and procedure which applies to contested PRA enforcement cases read PS/EDMC2018 ‘Enforcement Decision Making Committee’.

The 'PRA investigation referral criteria' sets out the considerations we take into account when deciding whether or not it is appropriate for us to investigate a matter, and to determine which of our responses and/or investigation tools is appropriate.

Our ‘Regulatory investigations guide’ provides, at a high level, a ‘roadmap’ of our investigation and enforcement processes. It is intended as a reference for firms and individuals who are the subjects (or potential subjects) of a PRA investigation, and their advisors.

A summary of our enforcement activity is provided in a speech ‘The PRA’s approach to enforcement’ by Miles Bake, Head of Enforcement and Litigation published on 31 July 2019. This covers: our approach to enforcement; setting out the rationale for enforcement; examples of enforcement in action; and our enforcement ‘agenda’. It explains how enforcement is aligned with and supports our objectives and strategic goals.

How has the PRA used its enforcement powers?

Below are details of the enforcement actions that we have taken to date, with links to the underlying Final or Decision Notices.

* Joint action with FCA. The FCA imposed separate enforcement sanctions.

Open investigations

We also provide details of how many investigations are open at any time. For the purposes of these statistics, an investigation is considered open from the time that we have appointed investigators until either it is closed, or a Settlement Agreement is entered into or, in contested cases, a Final Notice is issued.  

Each firm or individual under investigation is counted for these purposes, even if they are related (eg if we are investigating a firm and two individuals at said firm, that would count as three investigations). 

We do not usually make public the fact that we are investigating a particular firm or individual.

Total open investigations 

  31 December 2019  31 December 2018 
Firms  8
Individuals  16*  16 
Total  24*  23 

* This includes one matter which has been referred to the Upper Tribunal. 

 

PRA statutory supervisory powers

The Financial Services and Markets Act 2000 also grants us formal powers, which can be used in a supervisory context. For example, we can vary a PRA-authorised firm’s permissions to undertake regulated activities, or require a firm to undertake or stop an action. We can also approve (subject to conditions) an application for an individual to perform a senior (insurance) management function. Our approach to deploying these powers is set out in its approach documents.

This page was last updated 22 October 2020

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