FCA urges ministers to give UK regulator more power to guard against AI risks

The Financial Conduct Authority (FCA), the UK's financial services regulator, published a review on July 6, 2026 that The Guardian calls a "landmark review". It urged ministers to widen the regulator's powers to protect consumers from AI risks, including a rise in fraud and cybercrime.

What the FCA review found

The review, known as the Mills review, examines how technology will change UK financial services "from 2030 onwards". The FCA (Financial Conduct Authority) is the UK's main financial services regulator. It supervises banks, insurers and investment firms in the City of London and protects consumers' rights. According to the watchdog, firms are already starting to shift from human-led services to AI-based services for everyday retail customers. Routine tasks once handled by bank and insurance staff are gradually being taken over by automation.

• The review is called the Mills review and was prepared for the Financial Conduct Authority (FCA)
• The Guardian describes it as "landmark" (landmark review)
• The analysis looks at the transformation of UK financial services "from 2030 onwards"
• The FCA notes that firms are shifting from human-led services to AI services for retail customers
• The material was published by The Guardian on July 6, 2026

What risks the regulator sees

The key risk named in the FCA review, published on July 6, 2026, is a rise in cybercrime and fraud as financial services move to AI. Because of these risks, the review's authors insist that UK ministers expand the City regulator's powers. Otherwise, the FCA will not have enough tools to respond to new fraud schemes built on AI technology.

This is not a hypothetical threat, but a process that, according to the watchdog, is already under way: routine consumer services are moving to AI faster than the rules governing their oversight are changing. The review itself does not detail specific fraud mechanisms, but it explicitly cites the growth of these risks as one reason the City regulator needs broader powers.

"The

City regulator's powers need to be expanded to protect British consumers from AI" — this is how The Guardian relays the main conclusion of the Financial Conduct Authority (FCA) review.

What this means

The FCA review shows that British regulators are preparing for a scenario in which retail financial services, from everyday banking to insurance, increasingly move to AI, and the risks of fraud grow with them. For now it is an appeal to ministers, not a finished law, but it sets the agenda for future rules on AI in the UK financial sector. The faster firms bring AI into customer service, the more pressing, in the FCA's view, the question of the regulator's power to respond to new risks becomes.

For ordinary consumers, this means familiar financial services will increasingly run on AI before new protection rules take effect. The FCA review is trying to close precisely this gap between technology and regulation.