March 2026 Insolvency and FCA Industry News

The first quarter of 2026 has brought significant regulatory developments across the insolvency and financial services landscape. From a strengthened Code of Ethics to new enforcement records, here is our roundup of the key changes affecting insolvency practitioners in England and Wales.

Revised Insolvency Code of Ethics Now In Force

The revised Insolvency Code of Ethics (ICE), which came into effect on 1 October 2025, is now fully embedded in practice. The updated code introduces several notable changes that practitioners should be aware of.

Perhaps the most significant shift is the extension of professional behaviour requirements across an IP’s entire “professional life”. This now explicitly includes conduct on social media platforms, meaning that posts, comments and interactions online are subject to the same ethical standards that apply in formal professional settings.

The revised code also provides enhanced guidance on the role and mindset expected of insolvency practitioners, alongside new provisions addressing the use of technology in practice. For members of ICAS and ICAEW, there is an additional requirement to comply with recent IESBA amendments, which align international ethical standards with the updated domestic framework.

UK Sanctions List Replaces OFSI Consolidated List

As of 28 January 2026, the Office of Financial Sanctions Implementation (OFSI) Consolidated List has been permanently closed. The UK Sanctions List is now the sole authoritative source for sanctions screening.

This is a critical change for insolvency practitioners. If your firm’s anti-money laundering (AML) policies still reference the OFSI Consolidated List, these need updating immediately to reflect the new single-source arrangement.

The government has published a comprehensive user guide for the UK Sanctions List, which includes features such as fuzzy searching and multi-select filters to help practitioners identify sanctioned individuals and entities more efficiently. Firms should ensure that all staff involved in AML compliance are familiar with the new platform and its functionality.

New HMRC Insolvency Practitioner Handbook

In January 2026, HMRC launched a new Insolvency Practitioner Handbook on GOV.UK, replacing the long-standing Insolvency VAT Notice 700/56.

The new handbook consolidates existing guidance and IP bulletins into a single, navigable online resource. Rather than cross-referencing multiple documents, practitioners can now access HMRC’s insolvency-related guidance in one place. This should streamline the process of checking tax treatment, VAT obligations and reporting requirements across different insolvency procedures.

IPA Monitoring Visit Guidance Updated

The Insolvency Practitioners Association (IPA) published updated guidance on routine monitoring visits in February 2026, providing greater clarity on what practitioners can expect during the inspection process.

Key points from the updated guidance include confirmation that the IPA operates on a six-year inspection cycle. Lower-risk practitioners may receive just one inspection within that cycle, while higher-risk firms can expect more frequent visits.

Cases for review are typically selected two to three weeks in advance of a visit, giving practitioners reasonable notice to prepare relevant files. The guidance aims to make the monitoring process more transparent and proportionate, reflecting the IPA’s risk-based approach to supervision.

Insolvency Service Enforcement Statistics 2025/26

The Insolvency Service’s enforcement activity for the 2025/26 year to date reveals a continued focus on director misconduct, with some notable figures.

There have been 1,021 director disqualifications so far this year, with a mean disqualification period of 8.1 years. Of these, 676 relate to abuse of COVID-19 government support schemes, demonstrating that enforcement action connected to pandemic-era misconduct remains a significant priority.

February 2026 stands out as a particularly active month, with 114 disqualifications recorded. This represents the highest number of disqualifications in a single month. Additionally, 79 bankruptcy and debt relief restriction orders or undertakings have been made during the period.

FCA Focus on AI in Retail Financial Services

The Financial Conduct Authority (FCA) has launched a long-term review into the use of artificial intelligence in retail financial services. This signals the regulator’s direction of travel regarding AI-driven financial products and services, and is worth monitoring for firms operating at the intersection of insolvency and regulated financial services.

Beyond AI, the FCA’s current priorities include consumer investment protection, the developing framework for cryptoasset regulation, and the National Payments Vision. Together, these initiatives suggest a regulatory environment that is becoming increasingly focused on technological innovation and its impact on consumers.

This information is correct at the time of writing, 23 March 2026.

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