The FCA’s latest enforcement and consumer-protection updates reinforce a high bar for firms using automation. The regulator has highlighted money-mule activity, warned consumers about misleading debt-advice practices and continued action against firms that blur the line between UK-regulated and overseas activity. These developments are relevant to mortgage and financial-advice firms deploying AI in lead handling, onboarding and client communications.
Firms should ensure AI tools do not pressure clients, alter or “coach” affordability information, obscure a firm’s identity, or steer consumers towards unsuitable outcomes. Useful controls include human review of higher-risk cases and outbound messages, audit trails, data-quality checks, clear disclosures, access controls and regular testing for biased or inaccurate results. Automation can improve service, but it must support—not dilute—Consumer Duty and financial-crime controls.