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FCA fines focus on individuals as average penalty jumps

UK-Currency-Money-Coin-Pounds-GBP-700x450.jpgThe FCA has turned the focus of its fines from companies to individuals in 2018, latest data suggests.

An analysis from law firm Clyde and Co shows that while the total value of fines levied by the regulator in the year to date has dropped sharply compared to 2017, the average amount individuals are being pursued for has increased.

Last year, the average fine against individuals was £63,200. This has increased to £185,700 this year, a near three-fold increase.

Overall, the total value of fines is down from £229.5m to £27.6m, but Clyde says that this “does not paint the full picture” since “last year there were a number of record-breaking fines against companies that somewhat skewed the figures”.

FCA shows IFAs how duties might be split under senior managers regime

This included a £163m penalty against Deutsche Bank in January 2017 for money-laundering failures.

The number of open cases as at 1 April 2018 was also at a record high of 504, up from 410 twelve months before.

Clyde partner Charles Kuhn says: “City executives should certainly not be breathing a sigh of relief. The FCA has made a conscious effort to put the onus of responsibility on individuals. The introduction of the Senior Managers and Certification Regime is testament to this and the statistics demonstrate that this approach might be starting to bear fruit.

“The FCA has its foot firmly on the gas. However, it has come under some criticism over taking too long to prosecute and with a record number of cases in the pipeline some are questioning the regulator’s capacity to handle so many investigations.

“Eventually, these cases will be concluded and we could see a continual uptick in the level of fines levied against individuals. Especially as a number of the cases in the pipeline involve examination of the conduct of senior managers, which will of course test whether the SMCR might result in heavier punishments for individuals.”

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  1. And yet no onus of responsibility (for failure) is ever placed upon any individuals within the FCA. In fact, au contraire, as demonstrated by Clive Briault’s £612,000 golden parachute which, in the minds of many, was brazen daylight robbery.

    And where do all these fine monies go? Confiscated by the Treasury which, no doubt, actively encourages the FCA to keep its foot hard on the gas pedal.

    What became of the FCA’s past promise of “regulatory dividends” for the good guys doing their honest best to run their businesses in a clean and ethical manner? Quietly swept under the carpet on the basis that sooner or later it would be forgotten, not least because there’s nothing anyone can do about it anyway.

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