Financial Markets Disputes View: September 2025

What’s coming up

Global Legal and Business Outlook

Join us in person for this all-day event exploring key issues and trends in the financial services sector. Gain insights from leading lawyers and industry experts, network with peers, and enjoy happy hour drinks. Full agenda coming soon – register now to secure your place.

Contract Masterclass Webinar Series

Enhance your understanding of English contract law with concise 30-minute sessions running from 21 October to 13 November. Covering recent legal developments, drafting tips, and dispute risks, these webinars are designed to keep you ahead. Register today.

How AI is changing the legal sector

Ali Chaudhry, Legal Engineer at Simmons & Simmons, explores the transformative impact of artificial intelligence on the legal profession. Through this bite-sized series, Ali unpacks how AI is reshaping the way lawyers work - covering everything from practical skills like mastering prompt engineering to critical discussions on ethics, governance, and the future of the profession. Originally shared on LinkedIn, Ali’s reflections sparked significant interest, so we’ve brought them all together here for a wider audience to enjoy. Whether you’re a legal professional, a tech enthusiast, or simply curious about the intersection of law and AI, this series offers straight forward, easy to digest insights to help you stay in the loop.

As generative AI tools are increasingly used in the context of legal advice, important questions arise around the availability of legal privilege. For example, in what circumstances (if any) can AI-generated legal advice be privileged? Is privilege lost when legal advice is uploaded to AI tools? How does the use of AI tools to summarise documents impact their privilege status? We will tackle these thorny questions in our webinar on 3 November. Register here.

We are celebrating our success as a leader in Innovation and AI. Our very own in-house generative AI tool, Percy, has been named the winner of the ‘Innovation in Automation and AI Tools’ category at this year’s FT Innovative Lawyers Europe Awards. Find out more.

Key procedural updates

The Judicial Committee of the Privy Council has held that there is no rule against companies claiming legal advice privilege against their shareholders. Read our analysis here.

The FCA’s updated Enforcement Information Guide (August 2025) provides a concise overview of the FCA’s enforcement powers under the Financial Services and Markets Act 2000 and outlines the typical enforcement process. It reflects recent changes made to ENFG.

The headline grabbing element of the new ENFG was of course the FCA’s climb down on its ‘name and shame’ proposals, which had been widely trailed. What remains is the ability to publish in ‘exceptional circumstances’, which will be supplemented by the FCA’s ability to:

• Announce where there is suspected unauthorised or criminal activity
• Reactively confirm an investigation (e.g. where a firm or other investigatory body has already made the fact of the investigation public)
• Share information on an anonymous basis where it is desirable for education or to encourage compliance with FCA Rules (‘Enforcement Watch’)

Earlier in the summer the FCA made the first announcement under the new publicity policy – a reactive confirmation of an investigation into John Wood Group.

Other points in ENFG that caught our eye were:

• A focus on enforcement work reducing financial crime which highlights what we think is going to be the FCA’s key focus in the ‘pro-Growth’ era
• The bar has been raised for opening an investigation, which we think will result in greater use of FCA supervisory powers
• No investigation opened in the last 2 years has been closed with no further action
• Various deletions have been made to ENFG to reflect steps that were no longer used - specifically the preliminary investigation report and private warnings
• The FCA has introduced a power to refuse the attendance of a legal representative where it has concerns that their attendance may prejudice the investigation, e.g. if legal advisers are representing multiple parties
• FCA has clarified its practice of accepting disclosure on a limited waiver basis without reaching agreement as to how far privilege attaches to the report

Confidentiality is often cited as an advantage of arbitration over court proceedings, but what are the parameters of that confidentiality? Our article explores the decision in A Corporation v A Firm and Mr W which examines the general principle of confidentiality in English arbitral proceedings.

On 15 July 2025 HM Treasury and the FCA/FOS published consultation papers setting out their proposed approach for modernising the redress system. Read more here. As ever, the devil will be in the detail and, while there is a real possibility that these proposals will lead to significant change in the complaints that FOS handles on its own, it is equally possible that the new processes become so narrowly defined and little used that this will forever look like a missed opportunity.

This Corruption Enforcement Tracker follows key fraud and corruption enforcement actions by the UK authorities, with a focus on investigations relating to corporate wrongdoing.

On 01 July 2025 the UK's ratification of the Hague Convention of 2 July 2019 on the Recognition and Enforcement of Foreign Judgments in Civil or Commercial Matters ("Hague 2019") came into effect.

Hague 2019 provides a framework for the recognition and enforcement of civil or commercial foreign judgments internationally, though it has exclusions, including insolvency judgments. It has the potential to assist with the recognition of final and conclusive judgments given by courts in other contracting states to Hague 2019, which include the EU Member States (other than Denmark), Uruguay, Ukraine, Albania, Andorra and Montenegro. The USA and Russia are both signatories to Hague 2019, but there is currently no expectation that either will ratify it in the near future.

Our article looks at the impact of this development on the enforcement of English judgments and jurisdiction agreements.

Regulatory Enforcement

The FCA has been busy over the summer issuing three significant final notices dealing with financial crime systems and controlling failures. The notices highlight several risk management themes including the need to gather sufficient information to understand money laundering risks posed by specific clients at the outset of a relationship coupled with the need to carry out proper ongoing monitoring. Where a customer base is growing rapidly, special care needs to be taken to ensure that financial crime controls keep up with the pace of that growth.

Therese Chambers, FCA Joint Executive Director of Enforcement and Market Oversight, continues to talk about the FCA’s success in speeding up investigations. In her recent speech The confidence dividend: Tackling financial crime to strengthen markets | FCA she highlighted that: “Seven recent cases have reached a public outcome within 16 months or less; compare that to 2023/24, where it took an average of 42 months to close cases.”

The SFO secured £1.1m through its first successful use of an Unexplained Wealth Order, following the sale of a Lake District property in April 2025. The property had been purchased using money from a multi-million-pound investment scheme fraud involving no win, no fee law firms.

The FCA issued decision notices to Neil Woodford and Woodford Investment Management fining them for failures relating to the management of the Woodford Equity Income fund. Mr Woodford was fined £5.8m and banned from holding senior manager roles and managing funds for retail investors. Woodford Investment Management was fined £40m. The FCA concluded that Mr Woodford and his firm made unreasonable and inappropriate investment decisions which affected the ongoing liquidity of the fund. They did not react appropriately as the fund’s value declined, disadvantaging investors who remained in the fund. Both notices have been referred to the Upper Tribunal.

Sigma Broking Limited was fined £1,087,300 by the FCA for failing to submit complete and accurate transaction reports for 5 years.

Jean-Noel Alba, the former deputy chief executive of H2O Asset Management, was fined £1,049,500 by the FCA and banned from the financial services industry. The FCA said Mr Alba misled it during its investigation into H2O Asset Management, which focused on investments it had made in companies owned by German financier Lars Windhorst between 2015 and 2019. In particular, he provided documents to the FCA which had been created after the events in question but which he claimed were contemporaneous.

The PRA fined Barents Reinsurance S.A.'s London Branch £1,785,000 for failing to organise and control its affairs responsibly and effectively, as well as governance and regulatory reporting failures. This is the first time the PRA has fined a firm operating purely as a reinsurer.

The Bank of England fined Vocalink Limited £11,900,000 in respect of a compliance failure under section 196 of the Banking Act 2009. Vocalink had been issued with a direction by the Bank requiring it to remediate a number of identified systems and controls issues. It was given a deadline by which to complete this. It failed to meet the deadline through a combination of what the Bank described as an ineffective risk management framework combined with weaknesses in controls and governance arrangements. This is the first time the Bank has fined a financial market infrastructure firm.

In its most recent decision involving the FCA, the Upper Tribunal upheld the FCA’s decision to ban three former Mizuho International Plc traders from financial services for market manipulation. However, for two of the traders it reduced the fines proposed by the FCA. This is a pattern which has repeated itself this year. There have been two other substantive decisions and in both cases the Tribunal upheld the FCA’s decision but reduced the fine imposed. The regulator will no doubt take comfort from its success rate but the ability to secure a reduction in a fine may well encourage applicants to continue to refer decisions to the Tribunal.

In the courts

In Various Claimants v Standard Chartered Plc [2025] EWHC 2136 (Ch) the court had to consider whether risk of criminal prosecution in the US should prevent disclosure of certain documents. The judge noted that the risk had to be real, namely whether it was likely or not or maybe more probable than not. In this case he concluded that it had not demonstrated that there was any real risk of criminal prosecution or even civil enforcement action by regulators if the documents were disclosed. The defendant had done everything in its power to avoid disclosure, and the documents were only being provided under a court order. This would, he said, be a highly material factor for the US regulators to take into account in deciding what, if any, enforcement action to take.

In Shvidler v Secretary of State for Foreign, Commonwealth and Development Affairs [2025] UKSC 30 the Supreme Court held, by a majority of 4 to 1, that sanctions imposed on a naturalised UK citizen who left the Soviet Union in 1988, were a proportional interference in his human rights and therefore lawful. The sanctions were originally imposed due to his connections to Roman Abramovich and his former role as a non-executive director of a company doing business in Russia. The judgment is perhaps most notable for an extraordinary dissenting judgment from Lord Leggatt, who warned of an “Orwellian” approach to individuals’ rights and that the sanctions were punishing an innocent party to incentivise behaviour in others.

In Barclay-Ross v Starling Bank Ltd [2025] EWHC 2158 (KB), the High Court considered that there was an arguable obligation on a sending bank in the context of an authorised push payment fraud to retrieve money paid from a customer’s account after it was notified that the payment had been induced by fraud. This follows the decision earlier in the year in a case involving Santander which held that there was no duty of retrieval on a receiving bank in these circumstances.

In case you missed it

Russia sanctions litigation - recent developments & future risks

Since our last webinar in March 2025, there have been several key developments in Russia sanctions litigation, with firms continuing to face risks from cases brought by sanctioned Russian entities. In this session, experts from Simmons & Simmons and Alrud law firm shared updates on litigation trends, enforcement issues, new sanctions measures, and practical compliance implications. Watch on demand.

Motor finance

The UK Supreme Court has handed down judgment in three combined cases, all relating to alleged duties owed to customers by car dealers acting as credit intermediaries and the liability of third party lenders which provided the credit. The Court allowed the lenders’ appeals in part but upheld a claim by one of the claimants, Mr Johnson, under section 140A of the Consumer Credit Act 1974 but for reasons that differed from those given by the Court of Appeal. Read our analysis of the impact of the judgment here.

Financial services disputes essentials

Over three short summer sessions, our experts unpacked emerging regulatory priorities, litigation trends and enforcement risks that firms should be thinking about now. The sessions covered:

• Avoiding financial crime crosshairs: FCA intervention, APP Fraud, Sanctions, and Payment Pitfalls
• Consumer redress: top 5 things you need to know
• Greenwashing and sustainability: litigation, what regulators are targeting and how to minimise risk

Whether you're managing compliance, advising on litigation risk, or planning for what's next, this series is designed to help you stay ahead of the curve. Watch on demand.