A senior official at the UK’s Financial Conduct Authority has suggested that Britain should consider regulating general-purpose AI models, the kind that power ChatGPT, Claude, and Gemini. The recommendation, made on July 6, landed in the middle of an already heated debate about whether the UK’s light-touch approach to AI governance is actually working.
What the FCA is actually saying
The FCA isn’t proposing to write new AI-specific rules. The regulator has consistently maintained it will apply existing frameworks, specifically the Consumer Duty and the Senior Managers and Certification Regime, to AI use cases in financial services.
The suggestion to consider regulating the underlying AI models themselves, not just how financial firms use them, represents a subtle but meaningful shift. It’s the difference between regulating the driver and regulating the engine manufacturer.
This recommendation comes out of the broader Mills Review, which the FCA launched on January 27, 2026, specifically to investigate how AI is reshaping retail financial services.
