The FCA has hired a law firm which has represented some of the most high-profile rogue traders to advise senior staff at the regulator in an inquiry into how it announced its closed book review.
In March, the Daily Telegraph reported the FCA was set to force insurers to review exit charges on all their legacy policies as part of a closed book investigation.
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.
Clifford Chance senior commercial litigation partner Simon Davis has since been appointed to carry out the inquiry.
Sky News reports the FCA has appointed law firm Kingsley Napley to advise chief executive Martin Wheatley and other senior individuals in the review.
Kingsley Napley has previously acted for Nick Leeson after the collapse of Barings Bank, and UBS rogue trader Kweku Adoboli, who was sentenced to seven years in prison for unauthorised trading which led to $2.3bn (£1.4bn) losses.
Earlier this month, a freedom of information request submitted by the BBC revealed the FCA has so far been invoiced £116,845 by Clifford Chance for the inquiry.
The regulator has set aside £1.7m from its 2013/14 annual accounts to cover the costs of the review.
Last month, minutes of an FCA board meeting revealed the regulator will use an external press relations firm to provide advice to non-executive directors as part of the inquiry.
The FCA and Kingsley Napley declined to comment.