Ex-FSA lawyer criticises Sif hire and fire powers
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An ex-FSA legal adviser has hit out at the regulator’s new policing of firms’ significant influence functions which can now include the grilling of prospective candidates.
Noline Matemera, who spent seven years at the FSA within the general counsel and enforcement divisions and is now a financial services regulation lawyer at law firm TLT, says the extension of the approved persons’ regime is an example of “regulatory creep”.
In July, the FSA extended its approved persons’ regime to include those performing a significant influence function and said it will place greater emphasis on senior management, including non-executive directors.
Candidates for Sif roles may be interviewed by the FSA to assess their suitability for a job.
Matemera says: “The notion of the FSA indirectly hiring, appraising and firing Sif candidates on behalf of regulated firms is not too far off the mark and is an ominous indication of things to come. Is this not regulatory creep by another name?
“It is difficult to see how a Sif applicant can reasonably be expected to respond to questions on matters such as the circumstances under which a firm can be expected to fail. Surely, if it was that easy to divine answers to questions such as these, then the whole financial crisis would not have occurred.
“Similarly, the FSA has indicated it expects candidates to demonstrate an understanding of the inherent risks in the business. The shortcoming in this approach is that it does not recognise that Sif appointments are usually driven by career progression or internal promotion of candidates.”
An FSA spokesman says: “The new regime ensures individuals seeking to hold significant influence function positions within firms are both technically equipped and demonstrate the required integrity.
“These interviews are not exclusive to high-impact firms. We reserve the right to interview prospective candidates at any firm where we have concerns about the appointment.”
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Readers' comments (2)
Julian Stevens | 26 Nov 2009 11:02 am
Like the FSA has a great track record in terms of the people it's hired for itself? How long was John Tiner at the helm before jumping ship to greener pastures in the wake of a hardly dazzling litany of achievements?
Hector Sants will probably go next year to a juicy bank job. Then there was Clive Briault who has the odious distinction of not only having overseen the most catastrophic failure yet in the history of financial services regulation but also received the biggest pay off. And these are just the ones we know about ~ there are probably plenty of others.
Gordon Bennett ~ all these people ever seem to want is more powers and more money when a huge body of evidence strongly suggests that the FSA is incapable even of discharging its present responsibilities either competently or fairly.
Madness. And all of us out here are paying for it!!
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Melinda Storer | 19 Dec 2009 11:05 pm
As the City re-adjusts in the wake of the financial crisis, the FSA has found itself at the heart of the action – and is increasingly regarded as a highly desirable place to work. At present its enforcement division, headed by ex-White & Case litigator Margaret Cole, is looking to up headcount from around 300 to 340. Meanwhile, this year will also see an increase in the markets and exchanges division – the other section of the FSA with a large lawyer population – with a recruitment process currently ongoing. But competition for places is intense.
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Melinda Storer
lawyer marketing
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