FSA warns of 'no let-up' in moves to clean up banks
Britain's financial services industry has been told to expect "more pain" in 2010 from the chief city watchdog following a record level of fines this year.
The Financial Services Authority (FSA) says there will be "no let-up" in moves to clean up the industry's act following its role in plunging Britain into the worst financial crisis in a generation.
The watchdog imposed fines on 41 companies this year totalling £34.8m, an unprecedented rise of 53 per cent on last year. The level of fines could have been even higher but for the majority of miscreants opting to settle early with the regulator to qualify for a discount.
The FSA also banned 51 individuals from working in the financial services industry, two more than last year.
Margaret Cole, the FSA's director of enforcement, told The Independent: "Our bigger fines, record number of bans and successful criminal prosecutions this year reflect our tougher, more intensive enforcement approach."
It will make a difference, she says. "These outcomes have made people sit up and take notice and we expect to see a change in behaviour in the industry."
The two biggest fines were an £8m penalty on the Swiss bank UBS – for failing to prevent rogue traders from running riot with customer funds – and a £7m hit on the London unit of Canada's Toronto Dominion Bank for failings related to its traders.
There was also a £2.8m penalty on home loan company GMAC-RFC, for treating customers in arrears unfairly – an activity that the watchdog is policing much more aggressively given the heightened level of arrears caused by the credit crunch.
Companies have been repeatedly warned to tighten up their procedures, or face sharply increased penalties. On previous occasions the FSA has publicly questioned whether the level of fines it has imposed have been enough to "get the message" through to senior executives.
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