View more on these topics

Senior bankers “terrified” by accountability rules


City bankers are said to be “terrified” of new accountability rules which came into force this week.

The new senior manager and certification regime came into effect for banks, building societies, credit unions and insurers on 7 March, and will be extended across financial services by 2018.

However, according to the Financial Times, bank bosses are already warning they may be so “terrified” of the new regime that decision making and risk taking may be impeded.

It comes in spite of a last minute amendment to the rules, removing a so-called “reverse burden of proof”, which would have required senior managers to prove they had taken all reasonable steps to prevent conduct breaches.

Instead, the FCA will have to prove managers failed to do so.

Speaking to the FT, Royal Bank of Scotland head of conduct and regulatory affairs and former FSA managing director of supervision Jon Pain said: “This is [already] a difficult industry to recruit non-executive directors into . . . If you terrify them with that level of evidence; you make their job almost impossible.”

Santander UK chief risk officer Keiran Ford added: “What I worry about is a big team from the FCA turning up at my offices with 30 guys to go through the minutes of every meeting to second guess a decision I made a few years ago.”

At the same time, however, the broad principles of the new regime won support, with Barclays deputy chairman Sir Gerry Grimstone noting that after the financial crisis “there’s a palpable sense that the people who perpetrated the misconduct have not been brought to book”.

Grimstone said: “The outliers must be dismissed from the City; we have no room for them. The risk is that the fines have become a cost of doing business . . . the focus needs to be on bringing the right people to book.”

The FCA revealed how it would apply the accountability rules to its own staff earlier this week.


Griffith-Jones-John-FCA-2013 700x450.jpg

FCA staff to be held accountable under senior managers regime

The FCA has revealed how it will apply the core principles of the senior managers regime, which came into force for the UK’s largest financial institutions today, to its own staff. The regulator had previously pledged to apply the rules, designed to hold high-ranking individuals in financial services organisations to account for misconduct in their […]


Andrew Tyrie warns over ‘sluggish’ senior managers regime progress

Influential Treasury committee chairman Andrew Tyrie has warned progress by the regulators in bringing forward the new senior managers regime has been “sluggish” and “inadequate”. The SMR is due to replace the approved persons regime for the UK’s largest financial institutions from March this year. It will then be rolled out to all regulated firms, […]

FCA logo glass 3 620x430

FCA to force banks and insurers to protect whistleblowers

Banks and insurers must offer protections to all whistleblowers, under proposals outlined today by the FCA. In a joint consultation paper with the Prudential Regulation Authority, the FCA says firms should put internal whistleblowing arrangements in place and inform employees that they can whistle blow to regulators. The proposals apply to UK banks, building societies, […]


Seal of disapproval: The new rules that treat advisers like banks

Tougher accountability rules for advisers will add “unnecessary” regulatory costs which threaten to thwart efforts to widen access to advice. In a shock move last week, the Treasury announced the senior managers regime will be extended  to all regulated firms at some stage during 2018. The regime passes responsibility for ensuring staff are fit and proper […]


News and expert analysis straight to your inbox

Sign up


There are 3 comments at the moment, we would love to hear your opinion too.

  1. Perhaps an equivalent level of accountability is what prompted Tracey McDermott to withdraw her application to become the next CE of the FCA.

  2. Is it right and proper that the financial services industry is regulated on fear and terror ?

  3. “risk taking may be impeded”

    Yeah, that’s bad for what reason again?

    If we keep allowing banks to play ‘Russian roulette’ with the financial system, eventually our luck will run out and the legislators and central banks won’t be able to pull us back from the brink

Leave a comment


Why register with Money Marketing ?

Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

News & analysis delivered directly to your inbox
Register today to receive our range of news alerts including daily and weekly briefings

Money Marketing Events
Be the first to hear about our industry leading conferences, awards, roundtables and more.

Research and insight
Take part in and see the results of Money Marketing's flagship investigations into industry trends.

Have your say
Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

Register now

Having problems?

Contact us on +44 (0)20 7292 3712

Lines are open Monday to Friday 9:00am -5.00pm