FSA's Tiner vows to maintain tough line

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The Independent Online

John Tiner, the chief executive of the Financial Services Authority, said yesterday he would make "no apologies" for the regulator's new heavy-handed enforcement regime, as he unveiled a raft of measures to streamline and speed up the time it takes to conclude and act upon its investigations.

John Tiner, the chief executive of the Financial Services Authority, said yesterday he would make "no apologies" for the regulator's new heavy-handed enforcement regime, as he unveiled a raft of measures to streamline and speed up the time it takes to conclude and act upon its investigations.

Speaking at the FSA's annual meeting in London, Mr Tiner insisted that the regulator was not and would not be "enforcement-led" but added he felt no need to apologise to those who criticised the regulator for its tougher line over the past year.

The FSA has come under fire in recent months after handing down a record number of fines and disciplinary actions to firms and individuals. Earlier this week, Oliver Letwin, the shadow Chancellor, described its regulatory regime as "intrusive", saying he would rein in its powers if elected.

Elsewhere, questions have been raised over the independence, fairness and efficiency of the FSA's enforcement process.

Within the industry, Legal & General has led the protest, arguing that the relationship between the regulator and its regulatory decisions committee is too cosy. It is appealing against an FSA fine of £1.1m for endowment mis-selling, and is due to appear for the next stage of its Financial Services & Markets Tribunal hearing today.

Last month, the tribunal of Paul "The Plumber" Davidson had to be abandoned after it was revealed that the head of the FSA's regulatory decisions committee had potentially prejudiced proceedings by talking to one of the judges involved in the case.

While both Mr Tiner and Mr McCarthy, the FSA chairman, remained adamant yesterday that their enforcement process was both independent and fair, they conceded that it could be more efficient.

Concluding an "end to end" review of the enforcement process, Mr Tiner said the FSA would be taking steps - such as investing in its IT infrastructure and accelerating the decision-making process - to speed up the time it takes to conclude its investigations and hand down disciplinary actions.

As an example of the new slicker regime, Mr Tiner cited the recent investigation into the share dealings of Stuart Rose, the new chief executive of Marks & Spencer who was cleared of insider dealing last week. From start to finish, the inquiry took just 13 days to be resolved.

"I think most would agree that our recent swift investigation into certain trades in the shares of Marks & Spencer is evidence that we are on the road to [achieving our goals]," he said. "More broadly ... I expect overall a reduction of some 30 per cent in the time to complete an enforcement case as a result of the new arrangements we will put in place."

Mr Tiner also used his speech as an opportunity to update the industry on the current split-capital investment trust negotiations, reiterating that the regulator had now moved towards disciplinary action against several of the 21 firms accused of collusive market activity.

The FSA is trying to secure £350m compensation for investors who lost money after the sector collapsed in 2001. However, the firms have resisted the demands, with negotiations between the two sides having all but collapsed.

Mr Tiner said, however, he had five companies which were committed to thrashing out a deal with the FSA, while several others had said they would be willing to enter individual discussions if the group negotiations failed.

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