FCA Identifies Surveillance Gaps for Insider Dealing Across Seven UK Retail Brokers

The UK Financial Conduct Authority (FCA) has revealed that seven retail brokers operating within the country exhibited significant vulnerabilities in their client surveillance systems. These gaps hindered the firms' ability to effectively detect potential insider dealing activities among their client base. Although the regulator chose not to publicly name the specific brokerages involved, it mandated immediate technical and procedural upgrades for all affected entities.

To ensure proper adherence, the FCA deployed skilled person reviews in several instances, requiring independent third-party experts to audit and oversee the implementation of required fixes. This regulatory scrutiny underscores the strict expectations placed on retail brokers under the UK Market Abuse Regulation (UK MAR). Under these guidelines, financial firms are legally obligated to flag and report suspicious orders and transactions promptly.

Data highlights the broader reporting climate, showing that the FCA received 3,806 Suspicion Transaction and Order Reports (STORs) in 2025. This figure represents a 16 percent decrease compared to the 4,528 reports logged in the previous year. Specifically, insider dealing reports dropped by 21 percent down to 3,124 during the same comparative timeframe.

A primary finding from the regulatory visits was that some brokers had set their suspicion thresholds far too high. Consequently, legitimate alerts were likely filtered out before compliance teams could review them. The FCA's intervention serves as a strong reminder for retail brokers and market participants to continuously calibrate and test their surveillance mechanisms.

For funded traders and retail clients alike, regulatory compliance remains a critical pillar of market integrity. Brokers operating in Tier-1 jurisdictions must maintain robust infrastructure to prevent market abuse and protect overall ecosystem stability. As regulatory standards tighten, firms failing to upgrade their compliance tech risk severe regulatory penalties and mandatory operational overhauls.