The FCA has published its 2026 Wholesale Markets Regulatory Priorities report, a clear signal to investment firms, brokers, and asset managers of where supervisory scrutiny will fall this year. Here is what you need to know, and how to act.
A New Era of FCA Supervision
In March 2026, the Financial Conduct Authority (FCA) published its inaugural Wholesale Markets Regulatory Priorities report¹, replacing more than 40 individual portfolio letters with a single, consolidated guide for the sector.
This is not just an administrative tidy-up. It represents a deliberate shift in how the FCA intends to supervise wholesale market participants: more outcomes-focused, more risk-based, and, critically, far less forgiving of firms that cannot demonstrate robust systems and controls.
As the report’s foreword states, the FCA’s intention is simple: “less intensive attention on firms doing the right thing, and stronger, faster action where harm is greatest.”¹
For compliance officers at investment firms, asset managers, wholesale brokers and regulated intermediaries, this report is essential reading. Below, we break down the five priority themes and what each one means for your compliance function, and your technology.
Priority 1: Improving the Resilience of Firms and Markets
The FCA’s first priority is operational and financial resilience. Firms in wholesale markets reported 170 operational incidents in 2025, with third-party failures identified as the root cause of 26% of them¹. The regulator expects firms to:
- Ensure important business services are recoverable within defined impact tolerances.
- Develop scenario testing for severe disruptions, including cyber incidents.
- Maintain robust incident response and recovery plans.
- Assess and manage dependencies on third-party providers with rigorous due diligence.
- Implement liquidity frameworks that can withstand genuine stress events.
What this means in practice:
Compliance teams that still rely on shared drives, email threads, and version-controlled Word documents to manage their policies and procedures are exposed. When the FCA assesses a firm’s operational resilience self-assessment or conducts its ORQUEST review, it will look for evidence of structured, consistent, and auditable processes. A patchwork of spreadsheets does not provide that evidence.
Priority 2: Enhancing Efficient, Competitive, and Innovative Markets
The FCA is pursuing a wide range of market structure reforms in 2026, including:
- A new equity consolidated tape, with final rules expected by the end of half 1 2026.
- Reforms to the UK securitisation framework, with final rules in half 2 2026.
- Changes to client categorisation and conflicts of interest rules.
- T+1 settlement and dematerialisation of shares, a significant operational shift for post-trade processes.
- Amendments to transaction reporting to make the regime more proportionate.
What this means in practice:
Multiple rule changes landing in quick succession create a real risk of compliance gaps. Firms need a platform that allows policies, procedures and training to be updated quickly and pushed to relevant staff with confirmation of acknowledgement, not a slow cycle of document revision and re-distribution by email.
Priority 3: Enabling the Safe and Responsible Adoption of New Technology
The FCA is actively supportive of innovation, the Digital Securities Sandbox and PISCES are tangible examples, but it is equally clear that technology adoption must be governed properly. The regulator expects firms to:
- Understand the risks and opportunities that new technologies present.
- Ensure governance frameworks, testing protocols, and controls evolve in step with technological change.
- Demonstrate that AI-driven processes, automated trading, and algorithmic decision-making are subject to meaningful human oversight.
What this means in practice:
The FCA is not asking firms to slow down innovation, it is asking them to govern it. This means your compliance platform needs to be capable of housing technology-related governance documentation, risk assessments, and control frameworks alongside your core policies. The two cannot exist in separate silos.
Priority 4: Preventing Financial Crime and Market Abuse
Financial crime and market abuse remain at the top of the FCA’s agenda. The report calls on firms to strengthen surveillance capabilities, improve data quality, and tighten governance around AML and sanctions controls. The FCA has made clear it will use all available supervisory and enforcement tools where it identifies serious failings¹.
The FCA’s own multi-firm reviews have identified recurring weaknesses in:
- AML governance and the quality of suspicious activity reporting.
- Sanctions screening processes, particularly around complex ownership structures.
- Market abuse surveillance, including gaps in monitoring for insider dealing and front running.
- Conflicts of interest identification and management.
What this means in practice:
Compliance teams must be able to demonstrate an end-to-end AML and financial crime framework that is documented, monitored, trained against, and evidenced. A piecemeal approach, where AML policies sit in one folder, training records in another, and monitoring logs somewhere else, will not hold up under FCA scrutiny. The expectation is a consolidated, auditable view.
Priority 5: Managing Conflicts of Interest and Conduct Oversight
The final priority focuses on conduct and conflicts. The FCA expects firms to maintain strong conduct oversight to preserve market integrity and trust. This means:
- Proactively identifying and managing actual and potential conflicts of interest.
- Maintaining robust second-line oversight of front-office conduct.
- Ensuring staff are trained, competent, and that evidence of that competence is retained.
- Embedding conduct standards into day-to-day operations, not just documented in a policy that staff have never read.
What this means in practice:
The FCA is placing significant weight on governance, not just what your policies say, but whether your people actually know them and act on them. Firms that can demonstrate staff acknowledgement, structured training programmes, and a clear governance trail are far better positioned than those that cannot.
The Overarching Theme: Evidence, Audit Trails, and Systems That Work
Reading across all five priorities, a single thread emerges: the FCA wants firms to be able to prove their compliance, not just describe it.
The regulator is moving to a more outcomes-focused supervisory model, which means it will be asking firms to demonstrate that their governance, controls, and compliance processes actually work in practice. That requires:
- A full and searchable audit trail of policy changes, approvals and staff acknowledgements.
- Monitoring workflows that create evidence at each stage, not just a record of the end result.
- Training programmes with demonstrable completion rates and assessment results.
- Consolidated documentation that makes it easy for a reviewer to understand your compliance framework at a glance.
This is precisely the gap that tools like Word and Excel cannot fill, and why purpose-built compliance platforms are no longer optional for ambitious regulated firms.
How Leo Helps Regulated Firms Meet These Priorities
Leo is an end-to-end regulatory platform built specifically for financial services firms. It consolidates policies, procedures, monitoring, training, and governance into a single configurable platform, replacing fragmented tools and creating the kind of structured, auditable compliance environment that the FCA is now explicitly looking for.
| FCA Priority | How Leo Addresses It |
| Operational Resilience | Centralised policies and procedures with version control; incident and task workflows with full audit trail. |
| Market Reforms & Transparency | Rapid policy updates with staff notification, acknowledgement tracking, and configurable approval workflows. |
| Technology Governance | House all governance documentation, risk assessments and control frameworks in a single, searchable platform. |
| Financial Crime & AML | Dedicated AML module with monitoring, training, and evidence capture. Full audit trail for FCA review. |
| Conflicts of Interest & Conduct | Training module with completion tracking and exam readiness. Conduct oversight embedded in governance workflows. |
Don’t Wait for the FCA to Come to You
The FCA has been explicit and firms that are doing the right thing will receive less intensive supervision. Firms that are not will face stronger, faster action. The 2026 Wholesale Markets Regulatory Priorities report is not a future concern, it is the current operating environment.
If your compliance team is still managing obligations across multiple disconnected tools, now is the time to change that. A structured, auditable, and technology-enabled compliance framework is no longer a nice-to-have, it is what the FCA will expect to see.
Leo helps investment firms, brokers, and regulatory hosting firms build exactly that, from AML and governance, to training, monitoring, and exam readiness, all-in-one platform.
References
¹ Financial Conduct Authority (March 2026). Wholesale Markets Regulatory Priorities. Available at: https://www.fca.org.uk/publication/regulatory-priorities/wholesale-markets-report.pdf
² TheCityUK (2025). Key facts about the UK as an international financial centre 2025. TheCityUK. Cited in FCA Wholesale Markets Regulatory Priorities report.
³ Financial Conduct Authority (2024). Wholesale markets supervisory priorities. FCA.org.uk.
