Last updated: 26 October 2026

The Financial Conduct Authority has stopped six unregulated property lenders from taking on new customers or advancing new money, after raising concerns about their anti-money laundering controls. The restrictions were imposed between April and October 2026 and announced on 23 October.

The coverage so far has been written for brokers and compliance teams. This piece is for the people on the other side of the loan: borrowers who took a bridging or buy-to-let loan from a lender most of them had never heard was “unregulated”, and who now want to know what it means for them.

The short answer: these firms are registered with the FCA for one purpose only, money laundering checks. That registration gives borrowers no access to the Financial Ombudsman Service and none of the FCA’s conduct rules on fair treatment, arrears or fees.

Contents

• The six lenders and what was restricted
• What “Annex 1” registration actually means
• Why the FCA is acting now
• Is your loan regulated? The 40% test
• If you have a loan with one of these firms
• Before you borrow from any unregulated lender
• FAQ

The six lenders and what was restricted

All six restrictions are described by the FCA as voluntary, meaning each firm agreed to them at the regulator’s request. In practice they stop new business: no new customers, no new loans to existing customers, and in most cases no further credit on existing loans.

Firm	Restriction date	What it can’t do	Companies House
Kingscrown Finance Ltd	21 Apr 2026; further restrictions 25 Sep 2026	No new customers or new lending; limits on accepting payments; orderly wind-down of its loan book	No. 09346757, incorporated Dec 2014, Stockport
MOMSB Ltd	7 Oct 2026	No new customers or new lending; limited payment acceptance; independent AML review	No. 16536762, incorporated Jun 2025, London NW2
Momentus Capital Ltd	7 Oct 2026	Same as MOMSB	No. 16501287, incorporated Jun 2025, London NW2
Grosvenor Funding Ltd	9 Oct 2026	No new customers or new lending; limited payment acceptance; independent AML review	No. 10814139, incorporated Jun 2017, Manchester
Grosvenor Funding (North West) Ltd	9 Oct 2026	Same as Grosvenor Funding Ltd	No. 11909495, incorporated Mar 2019, Manchester
Abbital Ltd	15 Oct 2026	New customers, new lending and payments only on agreed conditions; independent review of AML systems	No. 13201332, incorporated Feb 2021, Stockport

Two patterns stand out from the public records. Four of the six are registered in Greater Manchester. And MOMSB and Momentus Capital share the same registered address in north-west London and were both incorporated in June 2025, so they had been trading for little more than a year when the restrictions landed.

Kingscrown is the odd one out. It lends for property investment, buy-to-let and houses in multiple occupation (HMOs), and its restrictions now include winding down its existing loan book. The FCA’s May notice said Kingscrown “has never been authorised by or registered with the FCA”. The regulator has not explained publicly how that sits alongside its inclusion in the October announcement on registered firms.

Grosvenor Funding’s website advertises bridging loans of up to 70% of a property’s value for residential purchases, and invites applications from individual homebuyers as well as businesses. When we checked it on 26 October, the homepage did not mention the FCA restrictions.

What “Annex 1” registration actually means

“Annex 1” refers to a list of activities in the Money Laundering Regulations 2017: lending, financial leasing, safe custody and money broking, among others. A business doing these things without being FCA-authorised for them must still register with the FCA, but only so the FCA can supervise its anti-money laundering controls.

The FCA is blunt about the limits. In its March 2026 statement it said these firms “are not subject to our wider rulebook”. It also warned that consumers using them “will not have access to the Financial Ombudsman Service” if something goes wrong.

What you get	FCA-authorised mortgage lender	Annex 1 registered lender
FCA checks on money laundering controls	Yes	Yes
FCA conduct rules (fair treatment, Consumer Duty, arrears handling)	Yes, for regulated loans	No
Affordability rules for home loans	Yes, for regulated mortgages	No
Financial Ombudsman Service	Yes	No
FCA can fine or ban for mis-selling	Yes	No (powers limited to money laundering rules)
Your route if there’s a dispute	Complaint, then ombudsman	Complaint, then the courts

Being “registered with the FCA” can sound reassuring in a sales conversation. For a borrower, it mostly means the firm has to check where your money comes from. It does not mean anyone is checking how the firm treats you.

Why the FCA is acting now

The six restrictions are the visible end of a sector-wide review that started with one collapse.

Date	Event
2024	FCA writes to Annex 1 firms’ chief executives about money laundering concerns
Late 2025	FCA follows up with 300 Annex 1 firms
25 Feb 2026	Bridging lender Market Financial Solutions (MFS) enters administration, reportedly with debts of more than £1 billion
20 Mar 2026	FCA opens an enforcement investigation into MFS and warns regulated firms about dealing with unregulated lenders
21 Apr 2026	First restrictions on Kingscrown Finance
7 Aug 2026	FCA announces “increased scrutiny” and sends an information request to around 900 Annex 1 firms
7 to 15 Oct 2026	Restrictions on MOMSB, Momentus Capital, both Grosvenor Funding companies and Abbital
23 Oct 2026	FCA announces all six restrictions

MFS was itself an Annex 1 firm. The FCA’s investigation notice stressed that it was registered only for money laundering supervision and was “not authorised or subject to wider FCA regulation”.

The scale is worth noting. The FCA put the number of Annex 1 firms at about 1,200 in March. The 300 firms contacted in late 2025 plus the roughly 900 in August add up to the same 1,200, and the FCA says this means it will have contacted every registered Annex 1 firm. Six restrictions so far is a small share, but the FCA says it is still assessing the responses.

Its August statement named a specific worry: unregulated lending “often done through complex structures such as special purpose vehicles”. In March it also flagged cases where consumers were encouraged to set up limited companies so they could borrow unregulated bridging finance, which takes them outside the protections they would otherwise have.

Steve Smart, the FCA’s executive director for fighting financial crime, said Annex 1 firms must show they can manage the money laundering risks they face, and added: “Where they cannot satisfy us, we will intervene.”

Is your loan regulated? The 40% test

Whether you have any FCA protection depends on the loan, not just the lender. Under article 61 of the Regulated Activities Order, a loan is a regulated mortgage contract when all of these apply:

• the borrower is an individual or trustees, not a company
• the loan is secured on land
• at least 40% of that land is used, or intended to be used, as a home by the borrower or a close relative (spouse or partner, parent, sibling, child, grandparent or grandchild)

Only an FCA-authorised firm can lawfully make a regulated mortgage. An Annex 1 lender should therefore only be lending where at least one of those conditions isn’t met.

Your situation	Usually regulated?
Bridging loan to buy your own next home, in your own name	Yes
Bridging loan on a buy-to-let or HMO you won’t live in	No
Any loan taken through your limited company or SPV	No
Loan for a flat your parent or child will live in	Yes (related person)
Development or land purchase loan	No

This is a simplified guide. There are further exemptions and special categories, such as some consumer buy-to-let loans, so check your loan agreement and get independent advice if the answer matters.

If your loan meets the regulated test but came from a firm that isn’t authorised to make regulated mortgages, that is a serious point to raise with a solicitor. Under section 26 of the Financial Services and Markets Act, an agreement made in breach of the authorisation rules is unenforceable against the other party, although a court can allow it to be enforced in some circumstances.

If you have a loan with one of these firms

The restrictions don’t cancel your loan, and they don’t change its terms. Your agreement still stands. What changes is the lender’s ability to do anything new.

• Keep paying as agreed. The restrictions limit how some firms accept payments. If your usual payment method stops working, ask the lender in writing how to pay, and keep proof of every payment.
• Don’t count on an extension. Bridging loans are short, often 12 months or less. A firm barred from “extending existing credit” may not be able to give you more time, so start arranging your exit (sale or refinance) early.
• Read your default and fee clauses now. Unregulated loans often carry high default interest and exit fees. Without FCA rules on arrears, the contract is what governs.
• Kingscrown borrowers: its loan book is being wound down. The FCA says Kingscrown has told all existing customers about the restrictions, and it directs borrowers to contact the firm about their own loan.
• Put complaints in writing. There is no ombudsman, so if a dispute can’t be settled, the route is the courts. A clear paper trail matters.
• Watch for scams. News like this attracts fraudsters offering to “take over” or “rescue” loans. Never pay fees upfront to someone who contacts you out of the blue.

If you’re struggling with payments, free debt advice is available from MoneyHelper and from charities such as StepChange, whatever type of loan you have.

Before you borrow from any unregulated lender

Unregulated lending is legal and fills real gaps, particularly for property investors and fast purchases. But the protections are thin, and the past year has shown how quickly a lender can run into trouble. Before you sign:

1. Check authorisation, not just registration. Search the FCA Financial Services Register. If the firm isn’t authorised for mortgage lending, treat it as unregulated.
2. Ask directly: “Is this a regulated mortgage contract?” Get the answer in writing.
3. Be wary of being asked to borrow through a company. The FCA has flagged cases where this was suggested to get around consumer protection.
4. Check Companies House. Look at how long the lender has been trading, who runs it, and whether its accounts are filed on time. Two of the six restricted firms were barely a year old.
5. Use a solicitor who acts only for you, not one suggested by the lender, and have them explain the default, extension and fee terms.
6. Plan the exit before you borrow. Know how and when you’ll repay, with a fallback if a sale or refinance is delayed.

We’ve covered other cases where investors found the safety net thinner than expected, including the Jarvis Investment Management special administration and the FCA warning on Acorn Property Invest. For how the ombudsman works when it does apply, see our guide to claiming after the Google Cloud outage.

FAQ

What are FCA Annex 1 firms?

They are businesses such as unregulated lenders, leasing firms, safe custody providers and money brokers that must register with the FCA under the Money Laundering Regulations. The FCA supervises only their anti-money laundering controls. They are not authorised and are not covered by the FCA’s wider rules.

Which lenders has the FCA restricted?

Kingscrown Finance Ltd, MOMSB Ltd, Momentus Capital Ltd, Grosvenor Funding Ltd, Grosvenor Funding (North West) Ltd and Abbital Ltd. The restrictions were imposed between 21 April and 15 October 2026 and announced on 23 October 2026.

Does my loan with one of these lenders still have to be repaid?

Yes. The restrictions stop new business but don’t change existing loan agreements. Keep paying as agreed and ask the lender in writing if you’re unsure how to make payments.

Can I complain to the Financial Ombudsman about an unregulated lender?

Generally no. The FCA has said customers of Annex 1 firms do not have access to the Financial Ombudsman Service. Disputes that can’t be resolved directly with the lender usually have to go to court.

Are unregulated loans illegal?

No. Lending to companies, or on property the borrower won’t live in, can legally be done without FCA authorisation. A loan secured on a home the individual borrower or a close relative lives in is normally a regulated mortgage, which only an authorised firm can provide.

How do I check whether a lender is regulated?

Search the FCA Financial Services Register for the firm and check whether it is authorised for mortgage lending. Registration for money laundering purposes alone does not make a firm regulated for lending.

Will more lenders be restricted?

Possibly. The FCA has sent information requests to around 900 Annex 1 firms and says it is still assessing the responses. It has said it will intervene where firms can’t satisfy it.

This article is for information only and is not financial or legal advice. If you’re unsure about your loan, speak to a solicitor or an independent adviser.

Sources: FCA press release, 23 Oct 2026; FCA, Kingscrown Finance restrictions, 11 May 2026; FCA statement on Annex 1 firms, 7 Aug 2026; FCA statement on unregulated lenders, 20 Mar 2026; FCA, investigation into Market Financial Solutions, 20 Mar 2026; Regulated Activities Order 2001, article 61; FSMA 2000, section 26; Companies House records for each firm (checked 26 Oct 2026); MFS debts as reported by Law360 (20 Mar 2026).