The article below raises serious concerns about proposed changes to FCA client categorisation rules — and from the Academy of Life Planning’s perspective, these concerns are not theoretical.
[Article, Money Marketing 3rd February 2026: FCA client categorisation shake-up faces consumer backlash, Momodou Musa Touray]
They are already playing out, quietly and repeatedly, in the real lives of people who believed they were protected.
The Financial Conduct Authority argues that proposed reforms are about widening access, flexibility, and growth.
The Transparency Task Force warns that the same reforms risk weakening consumer protection and deepening the trust deficit in UK financial services.
From where we sit, supporting people after harm has occurred, one issue stands out above all others:
Client categorisation failures are already excluding people from protection — after the damage is done.
The “Out of Scope” Shock
At Get SAFE and across the Academy’s wider work, we regularly see clients who:
- Made decisions believing they were retail clients
- Were never clearly told they were being treated as professional or non-retail
- Only discover this after something goes wrong, when they complain
Their experience with the Financial Ombudsman Service often follows a painful pattern:
- They complain in good faith
- They are told the matter is out of scope
- They are informed they are not a retail client
- They are left without remedy, clarity, or support
This comes as a profound shock.
It shouldn’t.
If It Wasn’t Disclosed, It Wasn’t Consent
Client categorisation is not an administrative technicality.
It determines rights, protections, remedies, and recourse.
If a person did not clearly understand — at point of sale — that they were giving up retail protections:
- That is not informed consent
- That is not a misunderstanding
- That is a regulatory failure
In those circumstances, the issue is not an individual complaint.
It is systemic.
And systemic failures sit squarely within the FCA’s remit.
The Regulatory Gap No One Owns
What we currently see is a damaging circular avoidance:
- FOS says it cannot look at the case because the client is not retail
- FCA says it does not handle individual complaints
- The consumer is left in a regulatory no-man’s-land
The harm is then compounded — not only financially, but psychologically — by the realisation that the system they trusted does not see them.
Lowering thresholds and widening discretion risks pushing more people into this gap.
That is not modernisation.
That is exposure.
Trust Is Not Built by Opting Out of Protection
The argument that sophisticated or wealthy individuals do not need consumer protection misunderstands how harm occurs.
Financial exploitation does not require ignorance.
It requires information asymmetry, power imbalance, and conflicted incentives.
As Andy Agathangelou rightly warns, loosening protections risks repeating patterns the system claims it has already learned from.
Trust is rebuilt by clarity, accountability, and enforceable standards — not by encouraging people to sign away safeguards they may only understand once it’s too late.
A Simple Test the Regulator Should Apply
Before any reform proceeds, one question should be answered clearly and publicly:
When someone discovers they are “out of scope”, who is responsible for the harm caused by that misalignment — and who fixes it?
Until that question has a credible answer, expanding professional categorisation is not progress.
It is risk transfer.
Read the full article here:
FCA client categorisation shake-up faces consumer backlash (Transparency Task Force response)
Comment from a Get SAFE perspective (for the article comments)
From a Get SAFE perspective, this isn’t a theoretical debate — it’s a lived reality.
We regularly support people who only discover after harm that they are deemed “out of scope” by FOS because they were not classed as retail clients.
In many cases, there was no clear, meaningful disclosure at point of sale that retail protections were being given up. That is not informed consent — it is a regulatory failure.
What follows is a damaging gap:
FOS says it’s out of scope.
FCA says it doesn’t handle individual complaints.
The individual is left without remedy.That is a systemic issue, not an individual one — and lowering thresholds risks pushing more people into that gap, compounding harm rather than preventing it.
Protection should not disappear at the moment it is needed most.
Academy of Life Planning 