By Ollie Wright, Head of FI Team, Estatesearch
The Growing Threat to Regulation
Regulation plays a crucial role in setting modern standards and ensuring accountability within the financial industry. Therefore, I’m concerned that the Treasury seems keen to weaken different regulators’ positions, aiming to save money by removing or defunding key organisations.
As I write, the Government has just axed the UK payments watchdog—the Payments Systems Regulator (PSR)—and the chair of the competition regulator was ousted in January. Now, the Treasury is considering measures that would undermine the Financial Ombudsman Service (FOS), an essential institution for impartial oversight.
Consumer Duty has also come under scrutiny, with one MP calling it “a waste of time.” These changes form part of a wider “radical action plan” aimed at reducing regulation to stimulate economic growth. However, regulation is there to protect us—the consumers—and rather than challenging regulatory bodies, we should be strengthening and supporting them.
Why Consumer Duty Matters More Than Ever
Principle-based regulation such as Consumer Duty ensures that financial institutions act fairly, especially when vulnerable individuals are involved. It plays a central role in protecting vulnerable consumers, enhancing industry practices, ensuring accountability, and promoting consistency across firms.
One clear area for improvement is in the bereavement process, where stronger regulatory oversight could help standardise practices and better support families navigating loss.
The Challenges of the Bereavement Process
At Estatesearch, we assist law firms by identifying financial profiles to support legal representatives in assembling estate assets during probate. Yet, this process is historically slow, often taking between six months and a year—or longer in complex cases.
In an ideal world, legal teams would have seamless access to all financial information. However, families often struggle to locate their deceased loved one’s accounts. It’s estimated that around £38 billion in assets remain ‘lost’ within UK banks and financial institutions.
We recently heard from a law firm where a UK bank withheld £25 million held in a foreign currency account until a Grant of Representation was secured. These challenges highlight why better regulation—not less—is needed.
Protecting vulnerable consumers and the impact of Consumer Duty
Since its inception, Consumer Duty has helped firms focus more closely on customers with capacity issues—those who are often unable to advocate for themselves. It has set clear expectations that firms must protect these vulnerable customers and ensure fair outcomes.
At Estatesearch, we have processed nearly 60,000 information requests to financial institutions, helping to identify assets held by deceased or incapacitated individuals. Thanks to Consumer Duty, financial institutions are increasingly willing to assist in this process, facilitating positive outcomes.
Without Consumer Duty, these gains could be reversed, harming vulnerable consumers and families at one of the most difficult times of their lives.
The Economic Case for Stronger Consumer Protection
The argument that reducing regulation will stimulate economic growth needs close examination. Reuniting unclaimed assets with their rightful owners ensures that money re-enters the economy through spending and investment, rather than lying dormant within institutions.
Moreover, without principle-based regulation like Consumer Duty, company cultures and practices would vary even more widely, leading to inconsistent, unfair customer experiences.
Why Bereavement Needs Greater Attention
While the UK’s largest banks have improved bereavement support, the wider financial sector remains fragmented. Some institutions still use GDPR as a reason not to engage with bereavement enquiries, even though deceased individuals are no longer protected under GDPR.
This results in poor data accuracy, with deceased or “gone away” customers still appearing on records well over a century old. It’s an issue we encounter regularly at our sister company, Estatetrace.
Such oversights can mean estates must be reopened years later, causing financial and emotional distress for beneficiaries—and exposing financial firms to potential compensation claims.
The Case for Expanding Consumer Duty
Consumer Duty has brought important progress, but there’s a strong case for going further. A 13th Principle could be introduced to specifically address the bereavement journey, ensuring standardisation across the financial sector.
Until financial institutions demonstrate a consistent and compassionate approach to bereavement and incapacity enquiries, protecting vulnerable consumers must remain a top regulatory priority.
Rather than dismissing Consumer Duty as unnecessary, the better path is to strengthen and expand it—to guarantee dignity, fairness, and better outcomes for bereaved families and vulnerable individuals alike.