Directors quit FCA ahead of leak report

Tracey McDermott, who played a leading role in the crackdown on benchmark rigging, is to be promoted as part of the management shake-up

Three senior executives left the Financial Conduct Authority on Monday ahead of a report expected to heavily criticise the City watchdog for its handling of an investigation into the pensions industry earlier this year.

The FCA announced that Clive Adamson, director of supervision, would leave as part of a structural overhaul. Also departing are Zitah McMillan, director of public relations, and Victoria Raffe, director of authorisations.

Tracey McDermott, who has played a leading role in the crackdown on benchmark rigging by banks in recent years, is to be promoted as part of the management shake-up. She will take the helm of a combined supervision and authorisation department.

“Now is the time to sharpen our focus” said Martin Wheatley, the chief executive of the FCA. “The financial industry continually evolves and to regulate it effectively we must evolve too”.

In March the FCA briefed the Daily Telegraph on a new investigation into historic pension policies. The paper suggested the regulator might allow policyholders to exit old, badly-performing savings plans, which could potentially have cost insurance firms billions in revenues. The share prices of firms across the sector lost £3bn in the wake of the report. They recovered after the FCA clarified the limited scope of its review.

At the time the Chancellor wrote to Mr Wheatley saying he was “profoundly concerned” by the FCA’s handling of the affair. An independent inquiry into the incident, by Simon Davis of the US law firm Clifford Chance, will be published tomorrow.

In March the chairman of Parliament’s Treasury Select Committee, Andrew Tyrie, said it looked as if the FCA had been guilty of an “extraordinary blunder” and had created a “disorderly market” through its actions. Yesterday Mr Tyrie said his committee would take evidence from Mr Davis on his report tomorrow.

The FCA said the departures of Mr Adamson and Ms McMillan were not related to the review. Mr Adamson said in a statement last night that he had been considering leaving the FCA for some time, and that he felt it was now the right time to hand over and “seek new challenges”.