Committee publication · Correspondence · 26 March 2025
Correspondence from the Financial Conduct Authority, relating to Safe Hands, dated 11 March 2025
From: Treasury Committee
Summary
The Financial Conduct Authority responds to the Complaints Commissioner's final report on Safe Hands, a funeral plan provider that entered administration in March 2022. The FCA defends its regulatory approach, stating it did identify risks and acted reasonably given resource constraints and limited powers before funeral providers were formally brought into its remit in January 2021. The letter frames the case as raising broader questions about FCA resource prioritisation across emerging sectors.
Key findings
- FCA disputes the Commissioner's conclusion that it failed to identify significant risks in Safe Hands; the regulator has issued a separate public response setting out its disagreement.
- FCA received anonymous intelligence in April 2021 that Safe Hands might be operating without authorisation, but logged it for consideration rather than immediately investigating, citing receipt of over 34,000 pieces of intelligence annually.
- FCA refused Safe Hands' application for authorisation on 8 February 2022; Safe Hands entered administration in March 2022. The regulator worked with Dignity and Co-op to help customers find alternative plans at reduced cost.
- FCA argues its approach was reasonable and proportionate; the Commissioner has acknowledged no evidence exists that alternative action would have led to different outcomes for Safe Hands customers.
- Letter highlights broader resource allocation challenges: FCA now receives 20,000 allegations of unauthorised business annually and must prioritise harm prevention, particularly as it takes on new sectors like buy-now-pay-later and crypto-assets.
Tone
DefensiveTopics
Key actors
Financial Conduct Authority, Dame Meg Hillier MP, Complaints Commissioner, Safe Hands, Serious Fraud Office, Dignity, Co-op, Stephen Braviner Roman
Notable line
“We believe the steps we took were reasonable and proportionate based on the information we received.”
Key Quotes
“The Commissioner has suggested that we didn't identify significant risks in relation to Safe Hands. We don't agree with this and have issued a public response setting out why.”
“That year, we received over 34,000 pieces of intelligence about firms or individuals potentially carrying out unauthorised business. There is no way we can immediately act on all.”
“We make difficult choices every week on how to prioritise resources to protect consumers from suspected wrongdoing.”
“Our most effective lever for tackling and preventing harm in areas which are being brought into our remit is when we decide to approve relevant firms.”
Source · parliament.uk record ↗