BoE Enforcement Actions

Key dates

August 2021

- Start of the relevant period during which HDI Global SE submitted incorrect FSCS Liabilities and FSCS Fee Tariff data to the PRA

Summer 2023

- By this point, HDI Global SE had still not checked the PRA Rulebook or guidance on FSCS coverage and fee tariff methodology, illustrating the duration of governance and diligence failures

January 2024

- The Early Account Scheme (EAS) becomes part of the Bank of England’s enforcement policy for PRA firms and FMIs

August 2024

- End of the relevant period of misreporting, including errors in data submitted as purported remediation of earlier incorrect returns

November 2024

- The Bank of England updates its statutory statements of policy and procedure on enforcement, setting out the PRA’s approach to exercising enforcement powers under FSMA 2000

Suggested considerations

• Review and map all FSCS Liabilities and FSCS Fee Tariff reporting obligations under the PRA Rulebook and applicable guidance, ensuring the firm’s methodology aligns with regulatory definitions of FSCS-covered liabilities.
• Conduct a detailed end-to-end review of regulatory reporting processes for FSCS data, including data sourcing, calculations, validations, and submission workflows, to identify and remediate control weaknesses.
• Develop and document formal, robust written procedures that govern the calculation and validation of FSCS Liabilities and FSCS Fee Tariff data, including change-control processes for methodologies.
• Assign clear ownership and accountability for FSCS-related reporting within the firm’s governance framework, ensuring named individuals or functions are responsible for accuracy, completeness, and timely submission.
• Strengthen internal oversight, challenge and review mechanisms over prudential and FSCS-related reporting, including regular independent checks by risk, compliance or internal audit.

What changed

• - The PRA has explicitly reinforced that FSCS Liabilities and FSCS Fee Tariff data are core prudential reporting metrics, and misreporting them may both impede risk assessment and cause underpayment...
• The enforcement action clarifies that failures to consult the PRA Rulebook and applicable guidance on FSCS coverage and fee tariff methodologies constitute a breach of Fundamental Rule 2 (due skill,...
• The PRA has signalled that the absence of effective written processes for calculating regulatory data, and lack of clear accountability, internal oversight, and challenge over those calculations,...
• The case demonstrates that remediation submissions are subject to the same accuracy and governance expectations as original returns, and that errors in purported remediation will be treated as...
• The PRA’s Early Account Scheme (EAS), formally incorporated into its enforcement policy in January 2024, is now clearly positioned as a mechanism that can materially reduce penalties where firms...

Key dates

7 October 2021 Deadline

22 May 2024; Period of identified breaches, including capital non-compliance, misleading submissions, and large exposure failures

Suggested considerations

• Conduct capital position audits to verify CRR reporting accuracy (individual and consolidated own funds) and remediate any discrepancies.
• Review intra-group exposures for large exposure limits (Articles 393-395), related party transactions (Rules 2.1/2.3), and notification obligations.
• Enhance governance controls for integrity (Fundamental Rule 1), including document fabrication prevention, timely solvency disclosures (Fundamental Rule 7), and prudent management (Fundamental Rule 3).
• Stress-test parent-subsidiary interactions and ensure openness with PRA on deteriorating positions.
• Update training on PRA enforcement policies (PS1/24) and bank supervision (SS3/21).

What changed

• This enforcement action does not introduce new rules but enforces existing PRA requirements with landmark application:
• First PRA fine for breaching Fundamental Rule 1 (conduct business with integrity), highlighting fabrication of documents as a core violation.
• First enforcement against a parent financial holding company (Oplyse Holdings), extending liability to group entities for capital reporting and related party exposures.
• Emphasizes strict adherence to Fundamental Rules 3, 4, and 7 (prudence, adequate resources, openness), CRR reporting (e.g., own funds on individual/consolidated basis), Large Exposures rules...

Key dates

2023

2024; Relevant period of miscalculation and breaches

13 August 2024

Firm notified PRA of error with preliminary root cause analysis

23 August 2024

Public disclosure via Regulatory News Service on SCR Coverage Ratio impact

1 July 2025

Aviva acquired DLG/UKI Limited (events pre-date)

10 March 2026

PRA issued Final Notice and imposed penalty

Suggested considerations

• Conduct control reviews: Assess finance/actuarial functions for preventative/detective control gaps, resourcing adequacy, and documentation (e.g., double-counting risks in Solvency II balance sheets).
• Test reporting accuracy: Validate Solvency II submissions (e.g., SFCR, SCR Coverage Ratio) against Rules 6.1, 2.4, 3.2; ensure factual accuracy, completeness, and reliability.
• Leverage EAS: Self-report errors early, provide candid root-cause analyses, and make admissions to qualify for penalty discounts.
• Remediate proactively: Invest in control enhancements, as UKI did post-identification; align with PRA 2026 priorities on data quality, internal models, and operational resilience.
• Document governance: Address longstanding resourcing concerns, per PRA's 2023 PSM letter risks.

What changed

• No new regulatory rules or requirements are introduced; this is an enforcement action applying existing PRA rules. Key breaches include:
• PRA Fundamental Rule 6: Failure to organise/control affairs responsibly/effectively due to ineffective preventative/detective controls and resourcing issues.
• Notifications Rule 6.1: Information to PRA not factually accurate or complete.
• Reporting Rules 2.4 and 3.2: Submissions lacked completeness, reliability, and compliance with SFCR structure/principles. This is the first EAS application, per PRA's enforcement approach (pages...