The National Audit Office (NAO) will investigate the Financial Conduct Authority’s (FCA) over its effectiveness and readiness to meet future challenges – particularly cryptoassets and artificial intelligence (AI).
Chief executive Nikhil Rathi informed the FCA board about the plans during its May meeting, according to minutes for the session.
“The board heard that the NAO wished to undertake a review of the FCA’s overall effectiveness and readiness to meet the challenges of the future, in particular, cryptoassets and artificial intelligence,” the notes said.
“The board noted that this was likely to be resource intensive.”
The issue of crypto came up again in the meeting, when on the promotion of cryptoassets the board considered the proposed policy statement on applying near final rules to cryptoasset financial promotions of authorised persons and registered crypto businesses.
The board wanted to know more about the appropriateness of referring to cryptoassets as ‘investment products’.
The board also approved the proposed near final rules and policy statement for authorised persons and registered crypto businesses. And it also approved the publication of the policy statement on cryptoasset financial promotions and the proposed implementation strategy.
The issue of cryptocurrencies and assets has been a sticky one for some time.
A year ago, Health & Protection reported that the FCA had said it did not believe the financial services industry should have to take on the costs of failures from firms promoting cryptocurrencies and assets.
The FCA also implored government to learn lessons from the rushed and ultimately failed introduction of the pensions freedoms that this should not be repeated with cryptoassets.
It was noted at the time that with the government consulting on its desire to create a world-leading crypto-market regime, it appears likely that the sector could come under the FCA’s remit, potentially increasing fees further.