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FCA says writing appeals process into law would ‘delay justice’

FCA chief executive Martin Wheatley has told MPs it would be a “mistake” to make the regulatory decisions committee a statutory body as it would delay justice for regulated firms.

The RDC, part of the FCA’s independent appeals process, hears appeals against enforcement, authorisation and supervisory decisions. It is made up of external committee members from the industry, including advisers, who report to the FCA board.

Although the RDC has been retained under the new regulator, there is nothing written into law to prevent the FCA from abolishing the RDC in future.

Speaking at a Treasury select committee hearing this morning, Wheatley argued the RDC should not be made a statutory body.

Wheatley said: “It would be a mistake. The current structure with our own enforcement process, then the RDC and Upper Tribunal allow the full range of appeals to go through the system. Many of our most complex cases take too long to get to final resolution.

“They take too long for all sorts of reasons; partly because of frustrations around lawyers putting all sorts of cases forward and partly because the RDC very often is insufficient and it goes to Tribunal. If we created a statutory process for the RDC it would delay justice and I do not think it is anyone’s interests.”

Wheatley said he also disagreed with the creation of a statutory RDC because the Upper Tribunal is already required by law so there would be “overlap”.

Last October the Government rejected calls from Labour, the Treasury select committee and its own backbenchers to make the RDC a statutory body during the passage of the Financial Services Act 2012.


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There are 9 comments at the moment, we would love to hear your opinion too.

  1. Incompetent regulators 10th September 2013 at 11:10 am

    How convenient. Anything that may require the regulator to justify its actions is wrong. They just want an easy life. Interesting that he gives no alternative solution. Lets just keep the regulatory system as it is and make those own laws!

  2. Cant say that I disagree with him !!!

    But it does go to show how complicated regulation has made everything, even the simple things take to much time and money so this would just make it worse !!
    It would be interesting to know how much the FCA spend on legal costs bringing these cases to book !!!
    I would guess it is thousands or even hundreds of thousands ?

  3. The Treasury select committee says its recommendations on accountability of the Financial Conduct Authority “require statutory force” in a report published (8 June).

    Why? Well this is why – we know the FSA is not accountable to Treasury Ministers or to Parliament, as confirmed by Hector Sants at a Treasury Select Committee meeting on 9 March 2011.

    How can anyone really accept the delegation of elected democratic judicial powers to an unelected quango. The Treasury select committee has made recommendations on accountability of the Financial Conduct Authority that “require statutory force” and this has been published today (8 June)!

    In contemporary usage, dictatorship refers to an autocratic form of absolute rule by leadership unrestricted by law, constitutions, or other social and political factors within the state. It suits whatever government to allow regulation by dictatorship i.e. unrestricted by law, constitutions, or other social and political factors within the state.

    I suspect that we have all been duped over many years into the false belief that we lived in a democracy subjected to the rule of law, where no man/woman or body is above the law. The FSA is an unelected, unaccountable body of the executive. In constitutional law the executive is the part of government but separate with responsibility for the administration of the state, in our case the regulation of the state and its financial services.

    The government claims the FSA/FCA is independent because they have an eye to preserving the myth of the “separation of powers”, a constitutional issue because if the government and executive are one and the same you risk dictatorships where the different powers of government are assumed by one body i.e. no separation of powers.

    The truth: The FSA and the government must be the same because the FSA is not answerable to government and the only way that could be tolerated is by virtue of the fact that the FSA is actually the government speaking. That must be the only explanation to the FSA’s lack of accountability.

    An abuse: Thus the separation of powers does not exist as authority is granted to the FSA/FCA at risk of our rights. You see the executive FSA is not supposed to make laws (the role of the legislature) or interpret them (the role of the judiciary). The role of the executive is to enforce the law as written by the legislature and for its actions to be adjudicated upon by the judicial system. We all know this is not the case in financial services. The FSA is therefore an abuse of power in a democratic system and as such a danger to us all.

  4. The TSC is just scratching an itch. When its recommendation to make the RDC statutory body was rejected by the coalition it meant the TSC did not get its own way, and that’s an itch.
    The TSC comprises of 5 con, 5 lab,1 lib/dem and 1 snp. so the opposition has as much say as the party in power, and as the original proposal came from the opposition, it itches more.
    Those who think this is a travesty of democracy are either impractical,only deal in theory or are lawyers, and who needs them!

  5. Couldn’t have explained it better Simon well put!

  6. Simon Mansell
    we bow to your superiority and sense of balance and justice.
    I would vote for you.

  7. “frustrations around lawyers putting all sorts of cases forward.”

    The arrogance here is astonishing. The Regulator would like you to believe that they are being fair by having some sort of impartial investigation followed by a handy 30% discount for early settlement.

    The truth is that the Enforcement Team is not a bunch of impartial investigators. They approach cases with an end in mind and then try and back fill with their rationale. Usually, this is at best sloppy when it comes to questions of law or fact.
    What actually happens is that even cases that result in the RDC determining fines should be levied, the fines are often less than the ‘discounted’ amount would have been, and large chunks of the case are often rejected by RDC…

    …I know one case where half o the alleged sales in the Warning Notice against one firm were actually made by another firm, and it took the RDC proceedings to take them out!

    Those nasty lawyers do not “put cases forward” to the RDC. This is what the Enforcement Team do if the accused party doesn’t then roll over.

  8. Isn’t delayed justice better than NO justice!

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