The FSA has failed in its attempts to fine former UBS UK wealth management division chief executive John Pottage £100,000 for misconduct after it found a series of compliance problems within the business, according to the FT.
The landmark case was the first in which the FSA had tried to penalise a senior manager for inadequate supervision rather than for actual wrongdoing.
According to a judgment seen by the FT, a London tribunal cleared Mr Pottage, having rejecting the FSA’s case against him and ruling he had taken steps to bolster UBS’s systems and controls.
The report says that Pottage, who is still a UBS employee, argued to the tribunal that he did all he could do eliminate poor compliance.
Pottage became chief executive of UBS’s UK wealth management arm in September 2006, he undertook a review of operations and compliance procedures in July 2007. The FSA has argued Pottage should have instigated a “root and branch” review of UBS’s operations and compliance procedures much faster than he did. By the time the review was put in place a number of incidents had occurred, including a £600,000 payment fraud and a rogue trading incident.
“John Pottage and UBS take note of the decision of the Upper Tribunal. We are pleased with the outcome and that this matter is now closed,” the bank said. The FSA declined to comment to the FT.