Compliance Monitor

For years the Financial Services Authority was lampooned for its seeming inability to bring enforcement actions against senior members of key firms. But cases in which it has lately made aggressive attempts to answer its critics have highlighted that regulatory expectations of Significant Influence Functions are somewhat skimpily outlined in the Handbook. Nathan Willmott warned a recent conference that many SIFs do not grasp the proactive rather than reactive nature of their responsibilities, as currently viewed by Canary Wharf.

As meat forms on the bones of the future regulator, Charlotte Hill and William Maycock summarise the FSA’s October Approach Document and flag up concerns for compliance officers.

Fees for the new regulators The FSA is consulting in CP12/28 on changes to its fees regime to adapt it for the Prudential Regulation Authority and Financial Conduct Authority. Proposed rule changes cover the introduction of separate PRA fee-blocks,..

In some areas the delineation between prudential and conduct of business matters may be clear-cut, but in others such as authorisation or assessment of governance arrangements it is clear that there will be an overlap in the interests of the Prudential Regulation Authority and Financial Conduct Authority. The following is an excerpt from a longer article entitled, ‘The new approach to insurance supervision’, available on the Compliance Monitor website. By Andy Moore, Mike Vickery and Kareline Daguer.

Recent FSA final notices and thematic reviews habitually highlight the role that poor Management Information (MI) has played in regulatory failures at financial services firms. Excessive and insufficiently relevant MI can seriously hamper management’s ability to understand and act upon conduct risks, advise Angus Goldie and Andrew Nanson. They suggest some questions that executives should be asking of their approach.

A cloud descended on Sun Life Assurance Company of Canada (UK) during October in the form of a £600,000 fine and final notice from the FSA for poor oversight of its with-profits funds. Yet again the regulator is honing in on firms’ governance, this time in relation to the need for clear structures and reporting lines. It doesn’t take much time to get these right, say Steven Francis and Imogen Hurst.

“Credible deterrence: here to stay,” was the truculent title of the FSA’s Enforcement Conference back in July. We’ve been warned. Adam Samuel examines the historical context of financial services enforcement and the arsenal of devices that may be wielded by the regulator.