The City watchdog has backed down on plans to force thousands of firms to comply with strict new consumer rules after pressure from Rachel Reeves to slash red tape. They could also be scaled back for certain firms, including those working with wealthy clients and firms serving customers from outside the UK. In January, the FCA outlined plans to drop requirements for firms to have a “consumer duty champion” on their boards. Mr Rathi’s letter stated that some banks had reported that the consumer duty had led to surging compliance costs for large stockbrokers, who are required to demonstrate that their businesses do not negatively impact customers. The consumer duty itself was introduced with the aim of setting “higher and clearer standards” for consumer protection in the UK’s financial industry.