Financial Markets Disputes View: October 2025

What’s coming up

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 here.

Agentic AI

The tool that can autonomously make decisions, plan, and take action to achieve goals with minimal human intervention – will be your next strategic technology challenge. Join us for this webinar where we discuss: contracting for the challenge of Agentic AI projects; the state of AI regulation and its impact on Agentic AI; data privacy approaches to Agentic AI deployment; and managing the IP challenge regarding use, creation and ownership. Thursday, 27 November 2025. Register here.

Public access to court documents

From 01 January 2026, parties to cases in the Commercial Court and Financial List will need to file key documents relied upon in proceedings so that they can be accessed by the public.

A new pilot scheme, set out in Practice Direction 51ZH and to run initially for two years, introduces rules to enable the public to access documents necessary to understand cases that go to a hearing. The idea is that, while hearings take place in public, it may not be possible for those who observe them to understand the proceedings without being able to see documents frequently referred to in those proceedings. The new obligations apply to represented parties and unrepresented parties who have already filed a document in the proceedings using the CE-File system.

Several categories of documents will be "Public Domain Documents" for the purposes of the new rules: skeleton arguments and any written submissions; witness statements and affidavits, but not their exhibits; expert reports, including appendices; and any documents critical to the understanding of the hearing ordered by the judge at the hearing to be Public Domain Documents.

Parties need to be aware of these changes and consider their impact. While the pilot scheme starts out in the Commercial Court and Financial List, it is likely to be rolled out across the Business and Property Courts before long. Our article explores the new rules in more detail.

Do the right thing

Therese Chambers delivered the keynote speech at the recent FCA Investigations and Enforcement Summit in London. Several aspects of what she had to say attracted our attention.

• She repeated the phrase she used at the conference 2 years ago, indeed it was the title of her talk - “do the right thing”. If firms do the right thing, the FCA will, she says, work with them. Presumably, the opposite is also true.
• If you provide banking to a fraudster, the FCA will investigate your controls.
• She suggested that there may be more Final Notices each year (up from around 25 to 30 per year), but these will result from far fewer investigations.
• In their “private disruption work” (which we took to mean supervision) more is going on than you may think.

Her speech also contained a warning dressed up as a promise - to pursue investigations when it’s the right thing to do and when they dig in, they will stay dug in until the bitter end.

Motor finance

As everyone will know, the FCA is consulting on an industry-wide scheme to compensate motor finance customers who were treated unfairly between 2007 and 2024 (CP25/27). Payouts on an expected 14m unfair agreements could start next year. The FCA estimates people would receive around £700 per agreement, on average. Based on the number of consumers the FCA believes could take part in the scheme, lenders could pay out £8.2 billion in compensation.

Alongside the consultation, the FCA, in conjunction with the Solicitors Regulation Authority, the ICO, and the Advertising Standards Authority announced coordinated actions to address misleading advertising and excessive fees by claims management companies and law firms handling motor finance claims. The FCA has also published various materials during October. These include its motor finance webpage containing links to relevant materials and FAQs, the Dear CEO letter sent to firms involved in motor finance lending and broking, the Dear CEO letter sent to claims management companies involved in motor finance commission claims and the recent confirmation that it has set up a data room which stakeholders can request access to for the purpose of responding to the consultation.

We have analysed the consultation and offer the following points by way of a high-level executive summary. If you would like to discuss further, please contact Caroline Hunter-Yeats or Tom Makin.

• All discretionary commission arrangements are in scope.
• As are “High commission” cases where commission is ≥35% of the total cost of credit and ≥10% of the loan amount. The dual test is to help ensure that “false positives” are not caught by the scheme, eg low-cost credit agreements, such as very low APR loans, or relatively small loan amounts, where commissions could appear very large relative to the cost of credit or loan amount.
• And also tied arrangements, or right of first refusal cases. It is expected that brokers may be the only ones who hold this information and the FCA has written to them to get them to start gathering records now.
• Presumptions - inadequate disclosure of relevant arrangements gives presumptions of unfairness and loss. For DCAs, once unfairness is established, loss is irrebuttable (i.e., it must proceed to redress). For high-commission/tied arrangements, loss can be rebutted only with clear, contemporaneous, customer-specific evidence that no lower APR was available from any lender the broker dealt with at the time.
• Redress - will be a hybrid remedy (blending a revised APR and return of commission, plus interest) in most cases. For Johnson-type cases, it is likely to require a full return of commission, plus interest.
• Opt-out for existing complainants to the firm (not at FOS); opt-in for everyone else. If a customer has already complained, the bank must treat them as in-scheme unless they opt out within 1 month of the bank’s letter (letters due within 3 months of scheme start). Consumers who haven’t complained must opt in within 6 months of the invite (or within 1 year of scheme start if not contacted). Complaints currently with FOS will be determined by FOS and not under the scheme.
• A Senior Manager will need to attest that the firm has robust processes, systems, and controls in place to successfully identify the starting population of potentially impacted consumers, to identify firm records and to plug any information gaps.

The consultation deadline is 18 November 2025 for comments on the redress scheme proposal but 4 November for proposals regarding the extension to the complaints deadline.

Arbitration – appeals on points of law

The court’s decision in Aston Martin Mena Ltd v Aston Martin Lagonda Ltd highlights an important factor to consider in drafting contractual arbitration provisions – whether or not to exclude the right to appeal to court on a point of law. Our article considers the issue in more detail.

APP reimbursement one year on

The Payment Systems Regulator has published its first annual review of the Authorised Push Payment reimbursement requirement and reported significant improvements in consumer protection and fraud prevention.

Highlights include:

• £112 million reimbursed to victims.
• 88% of the money lost to APP scams and claimed back from a payment firm was returned to victims. This has significantly increased from 66% for the same period in 2023/24.
• 97% of claims were resolved in 35 days and 84% of claims were resolved within five business days.
• Claim volumes are down.

The regulator noted that it has seen “strong, positive early outcomes with payment firms stepping up by preventing fraud from happening in the first place and reimbursing victims quickly.”

The review also explored the impact APP fraud has on victims:

• Of those who experienced fraud, 42% said their trust in their bank increased, whereas 38% of victims trusted social media platforms less.
• Half of victims who were reimbursed report trusting their bank more compared to around 1 in 3 of those who were not reimbursed.
• Of those who fell victim to APP fraud, almost 60% fell victim through purchase frauds.
• 49% of victims of fraud did not attempt to access reimbursement and 71% say they are unaware of the policy.

With regard to the last point the regulator noted “it is clear that more can be done to help victims know what they can do if they fall victim, and we expect firms to make sure everyone knows their rights.”

Enforcement

Obviously the FCA’s scheme to provide redress in the context of motor finance dominates the news but redress is not a new theme. A couple of redress cases, large fines from the ICO and OFSI and the use of criminal powers by the authorities feature in our round up this month.

In mid-October the FCA announced that it had "secured" redress for UK and other non-US investors in a fund sub-managed by Bluecrest Capital Management. Bluecrest’s appeal in this conflicts of interest case was due to have been heard by the Supreme Court in November but that appeal has now been withdrawn. It is worth noting that the final redress figure of £101m is substantially less than the FCA’s original estimate of £700m and the £40m fine from the decision notice has been dropped entirely. This perhaps suggests that either the FCA wasn’t in a strong position, or that it wished to clear a historic case. The desire to secure redress for affected investors is also a feature of the High Court proceedings the FCA has commenced against Concept Capital Group and various individuals over an alleged unauthorised investment scheme involving consumer investments of more than £23 million in static homes.

The FCA’s powers to name a company under investigation came under scrutiny in R (on the application of CIT (an anonymised company)) v The Financial Conduct Authority (No.1) [2025] EWHC 2614 (Admin). The court granted permission for judicial review but held that the FCA's decision was lawful. The court found the FCA had not misinterpreted its own Enforcement Guide and had not acted unreasonably in deciding that naming the claimant was desirable to further regulatory objectives, in particular the protection of the claimant's customers. The judge did note some weaknesses in the FCA's reasoning but concluded that the "key theme" of customer protection justified the decision to name the claimant. The judgment offers a rare insight into how FCA staff decide whether or not to name the target of an investigation.

One announcement which wasn’t challenged was an investigation into the Moneda Capital Group and a number of people associated with its companies. Moneda’s own website confirms that the FCA has also obtained a full asset restraint order but no further details of the investigation are given.

The FCA has fined Neil Sedgwick Dwane £100,281 for insider dealing and banned him from working for UK financial services.

The ICO has fined Capita plc and Capita Pension Solutions Ltd a combined £14m following a cyber-attack in April 2023 which saw hackers gain access to over 6m people’s data. This is one of the highest fines issued by the ICO to date and the highest this year.

OFSI has imposed its first penalty for breach of sanctions regulations on a UK company operating in the pharmaceutical sector. Colorcon, a UK-based subsidiary of a US-headquartered pharmaceutical coatings company, has been fined £152,750 for breaching the UK’s Russia sanctions regime. Colorcon operated a representative office in Russia that made payments in breach of sanctions for salaries and other employee-related services to accounts held by individuals with designated Russian banks. Colorcon decided to close its Moscow office in August 2022. More here.

The authorities remain committed to the use of their criminal powers to bring order to the financial markets. Examples this month include Daniel Pugh who has been sentenced to 7 years and 6 months in prison for running a £1.3m Ponzi scheme, following a prosecution brought by the FCA. The Metropolitan Police secured guilty pleas from two defendants in connection with what was described as the world's largest cryptocurrency seizure, valued at over £5.5bn. Zhimin Qian, 47, pleaded guilty at Southwark Crown Court on 29 September 2025 to acquiring and possessing criminal property, namely cryptocurrency, under the Proceeds of Crime Act 2002.

In the courts

Cases relevant to the financial markets which caught our eye this month included the following:

In Skatteforvaltingen v Solo Capital Partners LLP (in special administration) [2025] EWHC 2364 (Comm) it was held that the Danish Customs and Tax Administration (Skat) had failed to prove that the defendant hedge fund and others had defrauded it of £1.4bn in dividend tax refunds on dividends that had never been paid: the so-called cum-ex trade fraud. The misrepresentations alleged were not made and the cause of the losses was that Skat’s controls “were so flimsy as to be non-existent”, according to the court.

Advanced Multi-Technology for Medical Industry (trading as HITEX) v Uniserve Ltd [2025] EWCA Civ 1212 serves as a reminder that an innocent party faced with a repudiation is not absolved from continuing to perform the contract unless it communicates acceptance of the contract’s repudiation to the counterparty.

The use of AI in court has attracted a lot of attention, much of it criticism of unthinking reliance placed on it. On a slightly more positive note for the technology, in E. K. Tsikni v M. Kontis and Alphakon Ltd, case number 2212116/2023, in the London Central Employment Tribunal the judge rejected criticism of the claimant’s use of ChatGPT. He noted that the tribunal was cognisant that the Claimant had relied on AI tools to generate her witness statement” but that the tribunal had “given consideration to this in weighing the evidence we considered and heard.” He added that the respondents had received ample opportunity to fully interrogate and test the claimant’s evidence.

In Credit Suisse Virtuoso SICAV-SIF v Softbank Group Corp [2025] EWHC 2631 (Ch) Credit Suisse failed in its attempt to sue Softbank for allegedly orchestrating a string of transactions to ensure Greensill did not use $440m of capital injected in November 2020 to repurchase notes from a Credit Suisse fund. Miles J held that Softbank was unaware that Greensill used the funds for other purposes and was under no obligation to make enquiries.

In Houssein v London Credit Ltd [2025] EWHC 2749 (Ch) it was held that the express provisions of a facility letter did not require the lender to accept an offer of repayment that sought to impose conditions and delay the receipt of funds beyond the repayment date and no term could be implied requiring the lender to accept an offer of repayment on any terms other than those set out in the facility letter.

In case you missed it

Privilege and AI: Pitfalls and Practical Tips for Maintaining Legal Privilege with AI - In a recent speech, Master of the Rolls, Sir Geoffrey Vos highlighted the rapid shift in attitudes towards AI within the legal profession. There can be little doubt as to its growing impact but 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. here.

Global Legal Business Outlook – our all-day event exploring key issues and trends in the financial services sector. To get a feel for what went on, take a look at our short highlights reel.

Contentious asset management podcast series – exploring contentious themes and trends for Asset Managers and Investment Funds. The series covers: Reputational Risk Management, Conflicts, Market Abuse, S.90A FSMA Claims, Sanctions, Cyber, FCA Enforcement Themes and Trends and Digital Assets, among others. Listen on demand here.