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Dear CEO letters on Consumer Duty - closed products

What has happened?

In May 2024, the FCA issued six new Dear CEO letters concerning the Consumer Duty requirements for closed book products. The letters were directed to firms in the asset management, consumer investments, retail banking, consumer finance and life insurance sectors, with the other addressed to “all other firms”.

What are the key points of the FCA letters?

The FCA explains in the letters the background to the requirements for closed book products and explains the priority issues that are particularly acute or widespread in closed products and services, provides action prompts to ensure firms are prepared for the 31 July 2024 deadline for closed products and services, and provides a reminder, in Annex 1 to the letters, of the definition of closed products and services and an overview of the relevant rules. 

The FCA emphasises that it expects firms’ senior management to carefully consider the contents of the letters and to take steps to ensure their firm is compliant with the Duty by the deadline. It does understand that firms in some sectors may have no or very few customers with closed products and services, but it is circulating the letters widely to help firms consider broader distribution chains. 

Firms must review their closed products and services against all aspects of the Duty before 31 July 2024 and then on an ongoing basis. Boards will need to satisfy themselves that their firms have prepared adequately for the 31 July 2024 implementation deadline. 

The FCA highlights five key themes that firms should already be considering. This list is not exhaustive, but it draws on FCA supervisory insights, together with feedback provided through engagement with firms, trade bodies and other stakeholders:  

  • gaps in firms’ customer data, 
  • fair value, 
  • treatment of consumers with characteristics of vulnerability, 
  • gone away or disengaged customers, and  
  • vested contractual rights 

If firms believe that they will not be substantially compliant by the July 2024 deadline, and/or if there are any significant issues that come to light, they are requested to contact their normal supervisory contact at the FCA as soon as possible 

How we can help you

Thistle Initiatives has supported investment, credit, and insurance firms for over 10 years as a trusted compliance and regulatory adviser. In addition to assisting these firms as-and-when, our team of specialists can serve as your right hand in meeting and complying with FCA regulations. We understand the importance of staying up-to-date and compliant and are dedicated to providing the guidance and support needed to do so.  

Are you looking for help with your Consumer Duty arrangements, or more general regulatory questions? If so, we can help in any of the following ways; 

  • Reviewing your Consumer Duty approach to your closed products 
  • Reviewing the adequacy of your customer data 
  • Reviewing your approach to vulnerable or disengaged/gone away customers or the use by your firm of legacy customer systems (in the life insurance sector and the mortgage lending and administration sectors in particular) 
  • Assessing the adequacy of your compliance monitoring of your Consumer Duty arrangements 
  • Assessing the adequacy of your Consumer Duty board reporting 

Contact our specialist team now to schedule a free consultation. Get in touch with us by calling 020 7436 0630 or sending an email to