The Parliamentary Commission on Banking Standards has hit out at the strict deadlines imposed by the FSA on firms to send supplementary information to the regulator when requested.
Speaking to the PCBS this morning, FSA chairman Lord Adair Turner and FSA managing director Martin Wheatley were both grilled on the number of forms sent to firms by the regulator with strict conditions imposed upon them.
Cross-bench peer Lord Andrew Turnbull said: “The deadlines for data requests are getting shorter, firms are being asked for a very specific form which does not relate to how the firm collects its data and sometimes the purpose for the data being sought is not clear. Are you looking at how best to collect data and is there some check to ask whether you need this data and in this particular form?”
PCBS chair Andrew Tyrie hit out at a voluntary financial inclusion questionnaire sent to firms asking for data about staff on issues such as race, marital status and sexual orientation. Tyrie highlights one firm where the chief executive was pulled out of a major transaction because of “concern” about upsetting the regulator.
He said: “The chief executive considered the form along with his chairman at a pretty large finance house, who are very anxious to remain anonymous because they are concerned about the regulator. I just want you to think about the effect of sending a form like this because this has been happening over the last two years.”
Turner defended the regulator, claiming data collection is crucial to effective regulation through core reporting requirements and ad hoc requests for thematic reviews, enforcement action or a new supervisory programme.
He said: “If we are to add to our standard regulatory reporting then we would consult looking at the cost effectiveness of a change. Any changes going forward are quite likely to be driven by EU legislation, in terms of core reporting data.”
Wheatley said: “We will try to be proportionate and if we send out information requests we do not do it lightly as we know there is a cost to the industry in doing so.”