Regulator pledges to stay sharp in rooting out industry wrongdoing
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Margaret Cole, director of enforce-ment at the Financial Services Authority, has warned that the regu-lator will continue to bare its teeth when it comes to taking enforcement action against firms.
Speaking at the FSA’s enforcement conference last week Cole told attendees: “We are showing that the regulator has teeth and we know those teeth have to stay sharp.”
She says it has identified areas where consumers were being mis-treated, taken action to stop misconduct and forced companies to compensate those who have been treated unfairly.
Cole says: “This is not the end of our work in this area. We have observed that individuals and groups tend to move between companies and we intend to keep a close watch on standards using the intelligence we have gained.”
In the past two years the FSA has banned more than 50 professionals for mortgage fraud and secured redress of over £40m for mis-selling payment protection insurance.
Last October it also fined GMAC-RFC £2.8m for failing to treat cus-tomers fairly in relation to mortgage arrears and repossessions.
Cole says: “Last year we handed out 56 prohibitions and 46 fines with a record value of £33.6m. We’ve already exceeded this total only two months into the current year, with fines totalling £50m since April including record fines for a company and an individual.
“And in March this year we introduced a penalty-setting policy which will drive increased fines by relating penalties to the advantage gained from misconduct.”
She says that although the FSA is facing changes to the regulatory structure as outlined by the chancellor earlier this month, the need for enforcement activity is still strong.
Cole adds that since 2007 the FSA has transformed the culture, skills and expertise of its enforcement division.
She says: “Top class lawyers, investigators, accountants and forensic specialists don’t come cheap but we must have them and get the most out of them if we want to confront big banks and organised insider dealers, and come out on top.”
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