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FCA asked to review guidance on reporting fraud to police

Shadow-Figure-Street-Black-WhiteThe Complaints Commissioner wants the FCA to regularly check its enforcement team is following guidance on when they should report suspected fraud to the police after a complaint called into question the regulator’s processes.

The complainant alleged the FCA had failed to work with investors and the police in its enforcement action against two investment firms.

The complainant said there was enough evidence to raise a suspicion of fraud and the regulator should have involved the police in its investigations.

The FCA partially upheld the complaint and acknowledged there was a record-keeping failure by its predecessor, the FSA, which meant it could not determine how much the police were involved in the early part of the investigation.

The regulator said that would not have had an impact on investors but it did say the failure was “unacceptable”. Its complaints team recommended that the enforcement team should “ensure they have clear guidance on referring and recording decisions in respect of suspected fraud cases”.

The complainant referred the complaint to the Complaints Commissioner, who agreed with the regulator’s decision to partially uphold the complaint. The commissioner did not consider two other points in the complaint because they were not raised with the FCA first.

The Complaints Commissioner says this is not the first time doubts have been raised about the regulator’s procedures for reporting suspected fraud to the police. The commissioner pointed to a decision last year which gave details of another situation where the FSA had not involved the police at a “sufficiently early stage”.

The commissioner says the regulator should review the guidance that has now been put in place.

The complaint decision says: “I am pleased to have received confirmation that the FCA’s enforcement team now has clear guidance on when to report suspicions of fraud to the police, and I recommend that the FCA keeps the matter under periodic review to ensure that the guidance is being followed.”


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There are 5 comments at the moment, we would love to hear your opinion too.

  1. While they are looking into this maybe r=they should review the Ombudsman processes. It is not within the FOS’s remit to report claimants where fraud is suspected. They merely decide to process the complaint and suggest to the complainant that the matter should be dealt with by the courts.

    Fraudsters on both sides should be dealt with.

  2. What an absolute waste of time and money… there has been no material impact on the complainant ….

    And everyone is tripping up over bits of paper, procedures, red tape and every one is thinking to themselves have I done this, have I done that, oh must tick this box must dot that I and must cross that T ?…

  3. Well said Alan. What is required is an audit on the FOS, that’ll highlight nay problems!

  4. Start with CMC’s, the majority of whose standard modus operandi is to attempt fraud by way of all manner of totally false and spurious allegations.

    • You are absolutely right Julian, the problem is that the adjudicators at the FOS are so under qualified that they fall for the rubbish that these CMC’s spout, quoting regulations that have no relevance and coaching clients to say things that are just lies. A court would find them in contempt and lock them up, which is where they should be!

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