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UK watchdog restricts six private credit firms over anti-money laundering controls - Finance news and analysis from Global Banking & Finance Review
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UK watchdog restricts six private credit firms over anti-money laundering controls

Published by Global Banking & Finance Review

Posted on October 23, 2026

1 min read

· Last updated: October 23, 2026

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FCA Restricts Six UK Private Credit Lenders Over AML Control Failures

FCA Imposes Restrictions on Private Credit Lenders

Background of the Regulatory Action

LONDON, Oct 23 (Reuters) - Britain's financial watchdog said on Friday it had imposed restrictions on six private credit lenders over concerns about their anti-money laundering controls, limiting their ability to take on new customers and enter into new lending arrangements.

Details of the Restrictions

The restrictions curb the ability of the firms, which are relatively small, to take on new customers, enter into new lending arrangements and, in some cases, accept payments from existing customers, the Financial Conduct Authority said.

Increased Scrutiny Following Recent Events

The FCA has promised to increase scrutiny of unregulated lenders - called Annex 1 firms - in the wake of the collapse earlier this year of UK-based property lender Mortgage Financial Solutions. 

(Reporting by Phoebe Seers; Editing by Tommy Reggiori Wilkes)

Key Takeaways

  • The FCA’s measures target Annex 1 firms, which are only AML‑registered and not fully regulated, highlighting weaknesses in their tailored financial crime controls and reliance on parent firms’ frameworks (fca.org.uk).
  • This action follows the February collapse of mortgage lender Market Financial Solutions, which left creditors facing a shortfall of over £1.3 billion and triggered intensified FCA probes into AML compliance among unregulated lenders (uk.marketscreener.com).
  • The tightening of restrictions comes alongside broader efforts by the FCA to send information requests to approximately 900 Annex 1 firms and slow down registration processes to curb potential financial crime risks in the private credit sector (fca.org.uk).

References

Frequently Asked Questions

Why did the FCA impose restrictions on six private credit firms?
The FCA restricted these firms due to concerns about inadequate anti-money laundering controls.
What activities are limited for the affected firms?
They are restricted from taking on new customers, entering new lending arrangements, and in some cases, accepting payments from existing clients.
What prompted the FCA to increase scrutiny of private credit lenders?
The collapse of Mortgage Financial Solutions earlier in the year prompted the FCA to boost scrutiny of unregulated lenders.
Who are Annex 1 firms in the UK?
Annex 1 firms are unregulated lenders subjected to increased oversight by the FCA after recent industry events.

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