The FSA is launching a thematic review into banks procedures for finding and fighting investment fraud.
FSA acting director for enforcement Tracey McDermott says the regulator will examine how banks can prevent fraudulent schemes such as Ponzi schemes.
In a speech at the FSA’s Financial Crime Conference, McDermott said the review will probe banks’ role in countering these unauthorised businesses which depend on victims making payments from, and sometimes to, UK bank accounts.
She added such schemes may have been prompted by low investment returns offered by mainstream financial institutions.
The regulator has shut down three large pyramid schemes over the last 12 months, McDermott says tip-offs from the public were invaluable in this work.
The FSA is also launching a review into corruption and bribery and have a panel session this afternoon to discuss the new Bribery Act with representatives from the Serious Fraud Office and Ministry of Justice.
The FSA today published a consultation paper on financial crime, the findings of a review into mortgage fraud controls, and the findings of a review into how banks deal with money laundering.
The regulator has revealed that two banks have been referred to its enforcement division after spotting a number of serious weaknesses in their systems and controls for managing high-risk customers.