Sharp rise in cases opened by UK regulator FCA
13 Aug 2018

There’s been a marked increase in the number of cases launched by the Financial Conduct Authority (FCA), with figures showing it has almost a hundred more cases open compared to the same period last year.

“[The FCA] has a record 504 investigations open as of 1 April, compared with 410 a year previously. Just two years ago, the number hovered at around 100 cases,” the Financial Times said, “the bumper caseload includes 86 looking into suspected financial crime.”

“The jump in the total number of enforcement cases can be partially explained by the introduction of a different categorisation system: now each individual involved in a case is counted separately,” the FT explained, “under new accountability rules called the Senior Managers and Certification Regime [SMCR], the FCA now frequently opens a parallel case into top brass with particular responsibility for the issue under investigation. The increase is also because of an explicit push to open more investigations, and sooner.”

The regulator’s decision to take enforcement action is based on factors such intent to do wrong, negligence or whether it believes there has been serious misconduct.

In March this year it launched a consultation, seeking views on a number of questions about its approach to find out if its ‘being clear with its approaches and what else it could be doing.

“Through our enforcement activities, we identify and drive out behaviour that fails to meet our standards, or is dishonest or unlawful … in many of our cases, harm has already been caused, but early detection of an issue and intervention can prevent it from getting worse,” the FCA said, announcing the consultation.

Its attitude towards enforcement has come under strong criticism this year, including its decision to fine Barclays CEO Jes Staley £640,000 for attempting to identify a whistleblower, amid calls for stronger action to be taken against him.

Staley’s case was the first to be brought under the SMR.

In recent weeks the FCA has been heavily attacked for its decision not to take any enforcement action against the Royal Bank of Scotland over the mistreatment of small firms.

– Irene Madongo

Read more:

Barclays CEO fined £640,000 for misconduct

FCA takes no action against RBS over small business unit

Confessions of a compliance officer: The risk-based approach goes wrong

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