UK's FCA wants to become an "agentic regulator", using AI to automate supervision and enforcement
What's going on? Britain's Financial Conduct AuthorityDealroom has a profile for this one. Try Dealroom → plans to become an "agentic regulator", using AI to automate much of its supervisory and enforcement work, the Financial Times reported on 15 October. Chief data, information and intelligence officer Jessica Rusu told MPs on the Treasury Committee on 13 October that the watchdog wants "to automate wherever we can possible and to intervene at scale", and to "shift left" harms it can spot at the authorisation gateway.
What the FCA is already doing: Rusu said AI handles unstructured text well and is already helping case officers analyse intelligence faster across authorisation, supervision and enforcement, with a human still responsible for every decision "for now". Chief executive Nikhil Rathi said one of the first uses of its agentic tool was cleaning regulatory returns, going back "agentically" to firms to flag submissions that do not reconcile, freeing supervisors for higher-risk work. Rusu said frontier-model developers have been cooperating with the regulator, which shares information on model vulnerabilities and cyber risk with financial firms.
Context: The push follows the Mills Review led by former FCA executive Sheldon Mills in July, which recommended an AI-enabled, agentic supervisory model, argued the watchdog needs greater powers and urged authorities to look at whether ChatGPT, Claude, Gemini and other large language models should fall under financial rules. According to the FT, research for the review found a fifth of UK adults would be open to letting AI models make financial decisions for them. Rusu is due to set out the FCA's response to frontier AI models next week, alongside findings from live AI testing at firms.
No new AI rulebook (yet): The FCA is stopping short of AI-specific rules and is leaning on existing frameworks such as Consumer Duty. Rathi told MPs he is not convinced the FCA needs "lots more powers" until it has shown it has used its current ones to the fullest. Chatbots that give general information rather than individualised recommendations currently sit outside the regulated perimeter, a boundary he called "a very live discussion"; whether LLMs themselves should be regulated is ultimately a matter for Parliament.
Why it matters: One of the world's most closely watched financial regulators is turning AI on its own supervision rather than writing new AI rules for the industry. For UK fintechs and incumbents, that points to faster, data-driven scrutiny of filings and conduct, while the open question of whether consumer AI assistants giving money advice need regulating hangs over wealth and advice start-ups.
Sources: Financial Times (Martin Arnold, Emma Dunkley, 15 Oct 2026); Compliance Corylated (Treasury Committee session, 13 Oct 2026); Treasury Committee transcript via Parallel Parliament (13 Oct 2026)
