Welcome to the sixth edition of The Weekly Briefing!
Each week, we will recap the most interesting commercial news stories shaping the market, from corporate deals to regulatory shifts and highlight why they matter to businesses and law firms.
We aim to help readers sharpen their commercial fluency while keeping track of the legal angles behind the headlines.
UK lawyers and accountants
A new proposal has been introduced to expand the powers of the Financial Conduct Authority (FCA) by giving the regulatory body stronger and more intrusive oversight powers in anti-money laundering matters.
Various UK law and accountancy firms disagree with the proposal, despite the Treasury claiming that this new move would improve the way dirty money operations are being monitored and enforced against. Some voices in both industries warn that the transition towards anti-money laundering enforcement by the FCA over these two industries could hike compliance costs significantly.
However, voices from the Treasury claim that the move is necessary to address the “significant vulnerability” which exists in the professional services sector when it comes to identifying financial crime and catching perpetrators.
Others argue that the FCA will find it difficult to adjust to such a vast oversight responsibility, with some in the legal industry explaining that the FCA is not suited to being a supervisor for legal services. It remains to be seen how this proposal develops.
EU plans to use frozen Russian assets to help Ukraine
The EU has recently proposed that frozen Russian assets, which were taken over when Russia invaded Ukraine in 2022, ought to be used to fund Ukraine’s defence and rebuilding efforts. This would take the form of a EUR140 billion loan, paid out to Ukraine over a 3-year period, and secured against the frozen assets of Russia’s Central Bank. Since most of those assets are currently held at a securities repository in Brussels, Ukraine would have to repay the loan to the EU when the war ends.
Skeptics argue that the proposal is unrealistic because there is no guarantee that Russia would pay any compensation or, indeed, think about ending the war any time soon. Considering that President Trump recently postponed a meeting with President Putin in Budapest, the Russia-Ukraine situation does not look like it’s showing any signs of improvement. It just seems like the EU is trying anything in its power to leverage any advantage it has over Russia in an attempt to make Putin’s Russia give in.
Gold prices slip by 5% as markets adjust to the hype
Gold prices have experienced an astronomical surge in recent weeks, topping the charts at $4,381.52 per troy ounce amid global uncertainty and, interestingly, the peak of the wedding season in India.
One of the reasons for the unprecedented growth in gold prices was President Trump’s trade war, which saw investors stumbling to deposit their investment in “safe haven” assets such as gold, silver, and platinum. However, the ongoing US government shutdown meant that information about future markets is now severely limited, which contributed to the fall in gold prices.
Exchange-traded funds (ETFs) backed by gold have also risen in popularity, particularly in September, while central banks around the world were looking to gold as a hedging tool to protect them from the potential volatility of the dollar. Analysts now speak of the recent fall in gold prices as a much-needed correction, something which was bound to happen sooner or later.