“We are accountable to the Treasury, which is responsible for the UK’s financial system, and Parliament. However, we are an independent body and we do not receive any funding from the Government.”
This is how the FCA describes its role and how it operates. Advisers know all too well who foots the regulator’s bill, but after last week are probably less convinced of the FCA’s claim that it acts independently.
Martin Wheatley’s shock exit from the regulator, and George Osborne’s blatant involvement in his departure, means it is time to give up the ghost on this idea that the FCA is in any way independent of Government.
The noise around Wheatley’s fall from grace is the banking lobby has been whispering in Osborne’s ear that the FCA chief executive was too aggressive in his dealings with them. His “shoot first and ask questions later” comments, first reported by Money Marketing back in 2012,
have continued to haunt him all the way out the door.
Failing to renew a senior regulator’s contract should not be deployed as some sort of trophy to the banks, like a cat bringing home a dead mouse to its owner’s doorstep. There are parallels with the unceremonious sacking of Barclays chief executive Antony Jenkins, who failed to cut jobs hard and fast enough, and was not on board with the bank’s strategy around its investment banking arm. As one commentator put it: “The bad old days are back.”
Money Marketing is likely to be among the last people to come out in support of Wheatley – the FCA, and indirectly the man who heads it, has not always shown itself to be a friend of advisers.
Wheatley’s flat refusal to consider a refund for advisers who had been overcharged to the tune of £118m over five years will not be forgiven any time soon.
His tendency to deliver ad-libbed keynote speeches (as amply demonstrated by “shoot first”), not to mention the handling of the closed-book saga, also leave a lot to be desired.
But the era of record fines instilled under his watch is something to be commended. A regulator is supposed to take a hardline stance when it comes to misconduct, and from forex to Libor, that is what Wheatley has done.
The fact that banks are still making provisions to cover the cost of past wrongdoing suggests they are not so far down the path to reform that all should be forgiven.
Natalie Holt is editor of Money Marketing – follow her on Twitter here