Rawlins paid over 500,000 pounds despite collapse of Taurus: Stock Exchange chief calls for single City watchdog

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THE STOCK Exchange paid more than pounds 500,000 last year to Peter Rawlins, its former chief executive, who resigned in March after the Taurus computerised settlement system was cancelled.

The deal was attacked as 'a payment for failure'. It included a pounds 174,000 compensation pay-off and a 28 per cent pay rise for his last year.

Mr Rawlins was closely involved with the ill-fated Taurus project, cancellation of which cost the City pounds 400m. His pay-off caused raised eyebrows in the City yesterday - one top institutional fund manager said: 'The figure looks quite high considering what happened to Taurus.'

The Stock Exchange annual report yesterday showed Mr Rawlins was paid pounds 523,000 during the year, including basic remuneration of pounds 348,530.

Mr Rawlins was on a one-year rolling contract and his emoluments, 28 per cent higher than the previous year, included a salary of pounds 177,628, a further pounds 75,000 in bonuses unrelated to Taurus, such as controlling operating costs, and payments of pounds 77,399 into his personal pension scheme.

Sir Andrew Hugh Smith, exchange chairman, said it had 'provided what we were advised was the legal requirement'. He said the exchange had hired City headhunters to find a replacement. Interviewing had started.

The annual report also called for a single enforcement agency for the City and the introduction of civil as well as criminal penalties.

That received a mixed response from other City watchdogs. One senior City regulator described the exchange's insider dealing investigations as 'a shambles' and agreed this area should be handed over to the Securities and Investments Board.

But the same regulator opposed the creation of a single City-wide body, saying that it would inevitably be 'very large, very bureaucratic'.

Sir Andrew also called for a ban on through-traffic in the Square Mile and new stop-and-search legislation as a response to the recent Bishopsgate bomb.

All of which should not distract from a good year for the Stock Exchange, its busiest since 1987, Sir Andrew insisted. Domestic equity turnover rose by almost a third to pounds 474bn, with a record pounds 367bn foreign equities traded.

In the report the exchange threw its weight behind a single City enforcement agency. It said: 'There has been much public concern at the manifest weaknesses of the procedures for enforcing the law against market manipulation in general, and insider dealing in particular.'

The exchange said it was not widely realised how limited its powers were, and it was 'convinced that a single enforcement agency is needed, and that there should be civil as well as criminal penalties. The agency should have wide powers to carry forward the investigation of serious cases.'

The exchange investigated more than 295 possible breaches of trading and reporting rules in equities during the year to March and another 279 cases covering gilts.

Sir Andrew said that his first reaction to the latest IRA bomb had been that 'perhaps we should have a walled City again'. More realistically, he said that he had discussed the matter with the Corporation of the City of London and that the exchange was in favour of introducing licences for essential traffic, and new legislation to enable the police to stop and search unlicensed traffic.

Any scheme would involve the core of the City rather than the whole Square Mile.