Sentinel Regulatory Services news & information

The FCA updates its Appointed Representative (AR) data every six months based on Principals’ submissions including:

• “Add, Change and Terminate” AR data helps us understand the main reason for appointing the AR, the nature of the AR’s business and activities, and expected revenue from regulated and unregulated activities”.
• “REP025 data is submitted annually and helps us understand ongoing activities and potential risks related to principals’ ARs. This includes revenue from both regulated and non-regulated data, as well as complaints data.”

The FCA uses this data to identify potential areas of risk, which helps focus its supervision work more effectively. It also provides interesting insights into an aspect of the regulatory regime that is, perhaps, less well understood than it might be.

For example, Sentinel purposefully sought only Professional Client and Eligible Counterparty client types, which is an area we are very familiar with and like to think we understand. By doing so, based on the FCA’s September 2025 data, Sentinel’s potential universe of clients is approximately 4% of the total AR population. A strange decision? Possibly, but not if you take risk into account, particularly based on the many thousands of complaints received by ARs operating in the retail space. As shown below, ARs operate in seven clearly defined sectors as follows:

Key AR sectors (@September 2025):

• 181 Wholesale financial markets ARs
• 19 Retail banking
• 1,265 Pensions and retirement income
• 1,030 Investment management
• 7,394 Consumer investments
• 17,104 Consumer finance
• 7,019 General insurance and protection
• 34,012  Total ARs 

Peak AR

Was achieved in September 2020 when 43,169 ARs were registered. Total registered AR numbers have since declined by 21% over 5 years since that peak. Furthermore, the FCA reports that the mix of ARs has changed with Consumer Finance ARs increasing while those in general insurance have decreased.

Peak Principal

Was achieved in September 2019 when 3,576 Principals were registered. This has declined by 31% over 6 years to 2,469 by September 2025. Effectively less than 14 ARs per Principal.

No analysis is provided explaining why the number of ARs and Principals has declined over this time. Whether it is due to regulatory action, consolidation, market trends, a preference for direct authorisation or, more likely, a combination of all these and more.

The FCA data also discloses revenues generated by ARs, which is collected and used as the basis for calculating annual AR fees.

2024 Annual regulated revenues totalled £11.1bn

The 4 largest sectors for revenue generated by ARs from regulated activities are:

• £3.6bn General insurance and protection
• £2.4bn Consumer investments
• £2.3bn Consumer finance
• £1.9bn Investment management

2024 annual non-regulated revenues totalled £27bn

• £9.1bn Wholesale financial markets
• £8.5bn Consumer finance
• £7.4bn General insurance and protection
• £1.25bn Retail banking

A special mention to the 181 wholesale financial markets ARs that generated an astonishing £9.1bn in non-regulated revenues and 19 retail banking ARs generating an equally impressive £1.25bn of non-regulated revenues. Indeed, wholesale financial markets, consumer finance and general insurance and protection ARs generated significantly more revenue from non-regulated financial services activities than regulated.

In many respects the revenue figures resemble those we expect to see with ARs often conducting both regulated and non-regulated activities as they develop their fledgling businesses. The AR regime is flexible enough to allow firms to quickly establish small footprints in the UK that necessarily perform a variety of tasks including testing new markets and products, providing research services, investment advice, arranging transactions, relationship management, investor services and acting as a springboard into Europe and beyond, plus more besides.

As the £38.1bn total revenues demonstrate, it is a well-established, important aspect of the FCA’s responsibilities and not a marginal option used by a minority.