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‘Bosses face increased scrutiny by regulator’

The FSA fine imposed on former Millfield chief executive Paul Tebbutt could herald a wider clampdown on senior managers by the regulator’s enforcement division, says a specialist financial law firm.

TLT Solicitors head of financial services regulation Philip Ryley says the FSA’s transition to principle-based regulation and its treating customers Fairly regime are leading to an increased focus on senior managers’ responsibility.

Tebbutt was fined 35,000 by the FSA last month for providing misleading information. He failed to alert the regulator that the 3m funding that had been promised to plug any deficits when Millfield merged with financial adviser group Inter-Alliance could not be provided.

Ryley says FSA head of enforcement Margaret Cole has indicated that the regulator will take an uncompromising approach to failure at senior management level.

He predicts that this will result in an increase in enforcement action against senior managers.

Ryley says: “The FSA has said recently that it will be bold and resolute with enforcement. If the FSA does not take action against senior management after all its tough talk, then it will lose credibility.”

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