What happened?
TCC Group CEO Joe Norburn outlines strategic predictions for compliance in 2026, marking a decisive shift from interpreting the FCA’s Consumer Duty to proving its execution in practice. Despite ongoing political conversations regarding ‘reducing burdens’ to stimulate economic growth, the practical supervisory reality is moving in the opposite direction.
The FCA is operating an outcome-focused supervision model built on data. Firms face highly targeted evidence requests, granular audit trail reviews, and zero tolerance for well-meaning intentions without concrete, accessible proof.
Why does it matter?
Firms that treat compliance evidencing as a periodic, quarterly task will find themselves on the backfoot. Traditional manual-first compliance models that rely on low-volume file sampling are no longer sufficient to satisfy data-led audits. A weak evidence chain, missing audit trails, or unrecorded client conversations turn good business practices into significant regulatory risks.
Furthermore, while 82% of firms feel confident they treat vulnerable customers appropriately, many lack the comprehensive, retrievable data needed to prove it. Moving to population-level oversight is the only reliable way to validate customer comprehension and prevent systemic detriment.
Who is affected?
This analysis is highly critical for compliance leaders, board directors, and operations managers at wealth advisors, insurers, banks, and payment providers.
Key risks
- Unproven Customer Comprehension: Relying on policy templates rather than active, documented testing to prove customers understand products and fees.
- Fragmented Audit Trails: Unrecorded customer conversations or missing documentation that prevents the timely supply of evidence under S165 requests.
- Dated Manual Sampling: Continuing to rely on low-volume manual file reviews which fail to detect unevenly distributed operational risk.
Actions to take
- Establish Continuous Readiness: Integrate evidence-readiness protocols directly into daily operations, ensuring all customer-facing files and logs are easily retrievable.
- Upgrade Customer Testing: Implement post-interaction client surveys and structured comprehension tests to actively validate consumer support.
- Automate Conversation Logging: Move away from selective call recording to ensure 100% of customer interactions are logged and auditable.
- Deploy Predictive AI: Integrate predictive AI systems to analyze full conversation populations, triaging high-risk files for expert human review.
Wider implications
By late 2026, manual compliance models will be viewed as obsolete. Technology, specifically predictive AI with humans firmly in the loop, is transitioning from an innovative choice to critical compliance infrastructure.
Recommendations
Firms should audit their existing data quality and conversation recording capabilities, mapping out a clear roadmap to deploy automated evidence frameworks.
Supporting sources
Frequently asked questions
What is the key shift in compliance oversight for 2026?
The FCA is transitioning from assessing a firm’s compliance intentions and policies to demanding granular, data-led proof of good customer outcomes.
What is the limitation of manual compliance models?
Manual reviews cannot process the volumes required to provide statistically meaningful assurance, leaving firms exposed to undetected risks in back books.
How does predictive AI support human compliance specialists?
Predictive AI scans 100% of client interactions to spot risk patterns and missing steps, allowing human experts to focus their time on complex, high-risk files.
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- BankingTCC helps retail banks, challenger banks, building societies and specialist banking providers strengthen governance, manage financial crime risk and demonstrate good customer outcomes. Our specialists support Consumer Duty, remediation, regulatory transformation, FCA intervention and compliance assurance programmes through advisory, managed services, specialist resourcing and technology-enabled compliance. With more than 25 years of experience supporting FCA-regulated firms, we help banks respond confidently to regulatory scrutiny while strengthening operational resilience and customer trust.
- General Insurance & ProtectionTCC helps insurers, brokers, MGAs and protection providers evidence fair value, strengthen customer outcomes and identify emerging customer harm. We assess product governance, claims performance, distribution oversight and vulnerability risks, helping firms create regulator-ready evidence, improve operational performance and demonstrate that products and services deliver value throughout the customer lifecycle.
- Lending & Consumer CreditTCC helps consumer credit firms evidence good outcomes, strengthen affordability and vulnerability frameworks, and manage complaints, remediation and regulatory risk. We support lenders with practical, regulator-ready compliance programmes that improve governance, customer treatment and operational resilience.
- Motor FinanceTCC helps motor finance lenders, brokers and providers assess redress exposure, prepare for large-scale customer reviews and strengthen complaints, affordability and Consumer Duty frameworks. We combine regulatory advisory, managed operations, specialist resource and technology-enabled assurance to deliver consistent customer outcomes, robust governance and regulator-ready evidence under heightened FCA scrutiny.