FCA launches investigations on three money transfer business
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The Financial Conduct Authority has revealed that it has started investigations against three money transfer companies operating in the United Kingdom. The regulator noted that these money transfer companies might have violated the Competition Act of 1998.
FCA investigates money transfer firms for violating competitions act
The FCA noted that the three money transfer businesses have already been served with a statement of objections. A statement of objections is a document explaining why the FCA believes that a company under investigation has violated the existing laws surrounding business competition within the UK.
The notice issued by the FCA said that “There are provisional findings and may not necessarily lead to further enforcement action. A statement of objections gives firms notice that the FCA thinks they have infringed competition law and the opportunity to respond by making written and oral representations.”
The three money transfer firms investigated by the regulator are Hafiz Bros Travel & Money Transfer Limited, LLC Trans-Sending Limited, and Dollar East (International Travel & Money Transfer) Limited. The parent company of LCC, known as Small World Financial Services Group Limited, is also a part of the investigation.
Firms overcharged customers on foreign exchange rates
The regulatory body further said that the three companies had overcharged their clients. The violations happened between February 18 and May 31, 2017. The firms reportedly worked together to impose a fixed exchange rate when customers wanted to exchange pounds for Pakistani rupees.
The FCA’s investigations include Small World because the regulator believes the latter imposed a flat rate transaction fee on processing customer money transfers to Pakistan.
Despite the investigations being carried out by the FCA, the regulatory body has clarified that any violations likely happened in the “in-store services only” products offered by the companies. The regulator also noted that the online services the firms offer were not part of the alleged violation of the competition act.
The UK regulatory body has also noted that there is still much to be done to determine whether these companies violated the competitions act. The FCA will gather oral and written responses to determine whether any violation was conducted. These responses will guide the investigations into the companies.
The FCA has added that any further disclosures about the probe would not be shared with the public until the final decision is reached on whether the firms are guilty or not guilty of failing to abide by the provided regulatory guidelines.
The FCA has been aggressively regulating financial markets. The regulator imposed a £7.67 million fine against Guaranty Trust Bank Limited for failing to impose strict anti-money laundering policies and controls between 2014 and 2019.
