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It’s crunch time for London

In response to the continuing economic downturn the Treasury has launched an expert panel to consider the effect of the credit crunch on London as a global financial centre.

Alistair Darling will chair the group along with Citi chairman Sir Win Bischoff.

The new Financial Services Global Competitiveness Group will report directly to the High Level Group on City Competitiveness, which was set up by the Government in 2006 to develop and support a strategy for promoting London as a world-leading financial centre.

The group, comprising senior representatives from the financial services sector, will meet monthly to analyse global trends affecting the competitiveness of the international financial services industry, such as the impact of the sub-prime crisis and the rapid growth of new financial centres in emerging markets.
The analysis will help to inform the
Government¹s policy response to these challenges.

Darling says: “The financial services sector provides more than a million jobs in the UK and accounts for over 10 per cent of GDP.

“It is vital it can respond to the rapidly changing nature of international financial markets, with major shifts in financial flows and players to growing centres of influence and new sources of profit.”

He adds: “I have asked Sir Win to lead an assessment of these global trends, and on their impact on financial centres over a 10-15 year horizon, to help London and the UK maintain and enhance its leading place in the world¹s financial markets.”

Meanwhile the FSA has been kept busy with even more misbehaving brokers.
The regulator banned a former broker at Square Mile Securities Limited and fined him £16,000 for using unacceptable sales tactics.

Baljit Somal was banned for selling high risk shares worth £59,000 to customers without their consent.

Somal also made inaccurate and misleading claims about the high risk shares and used high pressure methods to convince customers to buy them.
The FSA also banned and fined North East-based mortgage broker Robin Knox £17,500 after he exposed 500 of his customers to the risk of receiving unsuitable advice.

Knox, managing director of Mortgage and Property Services Limited, was banned for lacking competence and capability and for failing to ensure his firm had proper systems and controls in place for the nature of the business it conducted.

The FSA also fined Knox for failing to organise the firm¹s affairs effectively and responsibly and failing to ensure the firm met required standards in recommending mortgage contracts.

FSA head of retail enforcement Jonathan Phelan says: “We are continuing to find instances where mortgage brokers are unwilling or unable to maintain the standards we require and where we come across this we will use our regulatory powers to ban these individuals and where appropriate impose a financial penalty on them as well.”

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