Retail Banking × Legal — United Kingdom · published 2026-05-26 · methodology v2.1

Legal basis of the Consumer Duty — FSMA 2023 disclaimer

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

What the RLB Specialist Panel found

1. Legal basis of the Consumer Duty — FSMA 2023 disclaimer

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 the Consumer Duty was introduced through FCA rulemaking under FSMA 2000, and accurately point to the relevant statutory rule-making powers. However, the AI omits any reference to FSMA 2023, failing entirely to address whether that later Act had any role in creating the Duty — leaving a gap where the regulator's own position is explicit.
What the regulator actually says: FSMA 2023 did not create the Consumer Duty.
Why the AI went wrong: The AI answered the question it was most confident about — the affirmative account of the legal basis — without addressing the negative clarification that the question specifically invited. Where a question calls for both a positive answer and a targeted disclaimer, AI tools tend to omit the disclaimer if their training data weighted the affirmative framing more heavily.
Cited source(s):
https://www.akingump.com/en/insights/alerts/new-fca-principle-12-consumer-duty — Pretextual

Impact for this audience

A Legal team at a UK Retail Banking firm that relies on an AI account of the Consumer Duty's legal basis — without the explicit clarification that FSMA 2023 did not create the Duty — risks embedding a structurally incorrect legislative narrative into internal guidance, board papers, and responses to FCA information requests. If the firm characterises its Consumer Duty obligations by reference to the wrong legislative source, the FCA may treat this as a governance failure, and any remediation programme required to correct downstream documentation carries direct operational cost and management distraction at a time when Consumer Duty oversight remains a live supervisory priority.

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. Retail customer definition — charity threshold and sourcebook variation

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 of the Consumer Duty — FSMA 2023 disclaimer — Retail Banking × Legal — 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/retail_banking/legal/finding/GB-FCA-GB-001-CONSUMER-DUTY-PS22-9-v1-002/

APA 7th edition

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

Bluebook / OSCOLA (US + UK legal)

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

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