Life Insurance × Compliance — United Kingdom · published 2026-05-26 · methodology v2.1

Legal basis for Consumer Duty — role of FSMA 2023

RLB-F-GB-FCA-CONSUMER-DUTY-PS22-9-Q002

What the RLB Specialist Panel found

1. Legal basis for Consumer Duty — role of FSMA 2023

Question (paraphrased to protect IP): Was the Consumer Duty created through primary legislation or FCA rulemaking? What is the legal basis for Principle 12 and PRIN 2A, and did FSMA 2023 have any role in creating it?
Source regulation: Consumer Duty (PS22/9 + PRIN 2A), Financial Conduct Authority (Regulator portal: https://www.fca.org.uk)
What AI assistants typically say: AI tools correctly identify that Consumer Duty was introduced through FCA rule-making under FSMA 2000 and reference FCA instrument 2022/31. However, they omit any mention of FSMA 2023, leaving out the important clarification that FSMA 2023 did not create the Consumer Duty — a distinction that matters when firms or legal teams are assessing the statute-versus-rule hierarchy.
What the regulator actually says: FSMA 2023 did not create the Consumer Duty. The Duty is founded in FCA rule-making powers under FSMA 2000, not in the later primary legislation.
Why the AI went wrong: The AI answered the question that was easiest to answer (what created the Duty) while silently ignoring the negative proposition (what did not create it). Omitting the FSMA 2023 disclaimer leaves a reader with an incomplete and potentially misleading picture of the statutory landscape.
Cited source(s):
https://www.akingump.com/en/insights/alerts/new-fca-principle-12-consumer-duty — Pretextual

Impact for this audience

A Compliance team drafting a board-level Consumer Duty policy statement or regulatory submission that relies on the AI's account of the Duty's legal basis will produce a document that misrepresents the statutory landscape — omitting the clarification that FSMA 2023 had no role in creating it. If this error reaches a regulatory return or an internal legal opinion used to scope obligations, the firm faces the risk of a supervisory challenge from the FCA and the cost of reissuing material to the board and to business lines that have already acted on it.

References — raw findings (per AI model)

RLB-H-GB-FCA-CONSUMER-DUTY-PS22-9-Q002-Sonnet46 Claude Sonnet 4.6 (web search on)

This finding also affects

Next finding → Finding 2. Scope of the harm avoidance obligation — customer-accepted risk

Cite this finding

Each finding has a stable Citation ID (RLB-F-… for aggregated case-study findings, RLB-H-… for raw per-model hallucinations) — like a DOI, the ID always resolves to the canonical finding even if URLs change.

Plain text

RegLeg Specialist Panel (2026). "Legal basis for Consumer Duty — role of FSMA 2023 — Life Insurance × Compliance — United Kingdom." Citation ID: RLB-F-GB-FCA-CONSUMER-DUTY-PS22-9-Q002. RegLegBrief AI Hallucination Research, published 2026-05-26. https://reglegbrief.com/audiences/sectors/gb/life_insurance/compliance/finding/GB-FCA-GB-001-CONSUMER-DUTY-PS22-9-v1-002/

APA 7th edition

RegLeg Specialist Panel. (2026). Legal basis for Consumer Duty — role of FSMA 2023 [Hallucination finding RLB-F-GB-FCA-CONSUMER-DUTY-PS22-9-Q002]. RegLegBrief AI Hallucination Research. https://reglegbrief.com/audiences/sectors/gb/life_insurance/compliance/finding/GB-FCA-GB-001-CONSUMER-DUTY-PS22-9-v1-002/

Bluebook / OSCOLA (US + UK legal)

RegLeg Specialist Panel, Legal basis for Consumer Duty — role of FSMA 2023 [RLB-F-GB-FCA-CONSUMER-DUTY-PS22-9-Q002], RegLegBrief AI Hallucination Research (May 26, 2026), https://reglegbrief.com/audiences/sectors/gb/life_insurance/compliance/finding/GB-FCA-GB-001-CONSUMER-DUTY-PS22-9-v1-002/.

BibTeX

@misc{reglegbrief_RLB_F_GB_FCA_CONSUMER_DUTY_PS22_9_Q002,
  author    = {RegLeg Specialist Panel},
  title     = {Legal basis for Consumer Duty — role of FSMA 2023},
  year      = {2026},
  publisher = {RegLegBrief AI Hallucination Research},
  note      = {Hallucination finding Citation ID: RLB-F-GB-FCA-CONSUMER-DUTY-PS22-9-Q002},
  url       = {https://reglegbrief.com/audiences/sectors/gb/life_insurance/compliance/finding/GB-FCA-GB-001-CONSUMER-DUTY-PS22-9-v1-002/}
}

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