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FCA appoints lawyer to handle closed book inquiry

The FCA has appointed a senior partner at law firm Clifford Chance to carry out an independent inquiry into its handling of the announcement of its probe into closed book policies.

The regulator’s non-executive directors have appointed Clifford Chance senior commercial litigation partner Simon Davis to carry out the investigation.

Last month the Daily Telegraph reported the FCA was set to examine exit charges as part of a review into closed book policies.

Insurers’ share prices plummeted in the six hours it took the FCA to release a clarification statement on the scope of the review.

The FCA issued a further statement later the same day to say it would carry out an investigation into its handling of the matter.

Chancellor George Osborne later wrote to FCA chairman John Griffith-Jones to express concern over the regulator’s handling of the issue and set out expectations for the scope of the investigation.

The FCA has set out the scope of the inquiry in terms of reference published today.

It says the inquiry will address why and with whose knowledge and authorisation the briefing was given to a single journalist, whether the content of the briefing was appropriate and if it went further than the agreed line, and to what extent the briefing is an isolated exception.

The inquiry will also look at how and when the FCA first became aware of a problem, and why it took so long to issue a clarification statement. 

The FCA says it aims to publish the final report “as quickly as is reasonably possible”, but declined to give a specific timeframe.

Treasury select committee chair Andrew Tyrie says the committee will take evidence from Davis in due course.

Tyrie says: “The committee will be seeing Davis shortly. It is vital that this investigation is wholly independent of the regulator.

“We will want to take evidence from Davis once he has reported.”

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  1. Am I incorrect in thinking that the TSC chairman requested that the TSC bring the appointed law firm in for a “chat” prior to any terms of reference being issued? I am sure I heard this and if this is the case it looks like the FCA are giving “the bird” to the TSC in the same way Hector Sants did a few years ago.

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