SIB prepares to simplify rules
Thursday 05 October 1995
The head of Britain's most senior financial watchdog yesterday signalled a move away from heavy-handed regulation in return for greater information disclosure by companies.
Andrew Large, chairman of the Securities and Investments Board, announced a fresh round of talks with the industry's more junior watchdogs to map out a new, simplified approach to regulation.
He also backed moves to end the present system, called polarisation, whereby advisers must either sell the products of just one company or be prepared to choose from the industry's entire range.
Mr Large argued that if more financial information were available, there could be a "disclosure dividend" both for investors and the industry.
But his comments drew a cool response from other regulators last night. One, who refused to be named, said: "I think he is trying to placate some of the insurance companies who have been lobbying for less controls of their sales activities. It all seems like a recipe for even more navel- gazing."
Mr Large, who was speaking at the Britannia Caledonian financial services lecture in Glasgow, said the benefits of financial disclosure were already apparent in the wholesale markets, including Eurobonds and derivatives. As a result, more overseas firms were choosing to base in the UK.
He argued that had more information been available, it might have been possible to forestall recent financial scandals, including the Barings merchant bank collapse in January.
He claimed that long-running problems in the retail financial sector had also been caused by companies' unwillingness to disclose information about their products. "When, sadly, investors were let down by advisers they were entitled to trust there was little prospect they would themselves spot something was amiss. I need hardly tell you what sort of problems the industry faces as a result.
"Some might accuse me in raising these points again of being too far ahead at a time when important issues still need to be addressed. For example, can we realistically alter the regime whilst the pension-transfer issues have yet to be addressed? I acknowledge that is a difficulty. But, we need to start thinking about the future.''
Phillip Thorpe, chief executive of Imro, the investment managers' watchdog, said: "Discloure is ... important but its capacity to be the universal panacea, particularly at the retail end, must be in doubt."
- 1 What happens to your body when you give up sugar?
- 2 Have sex with your iPad thanks to the new sex toy no-one asked for
- 3 The 'sex selfie stick' lets you FaceTime the inside of a vagina
- 4 Why you're almost certainly more like your father than your mother
- 5 Westboro Baptist Church couldn't picket Leonard Nimoy's funeral because they didn't know where it was
Mark Zuckerberg: Facebook CEO's one simple test for who to hire
Bali nine: Welcome to 'Execution Island' – the Indonesian holiday resort where foreigners are sent to die
'A girl is more responsible for rape than a boy': The statement that shocked the world... except India
The 'sex selfie stick' lets you FaceTime the inside of a vagina
Saudi Arabia executions now at 'unprecedented rate' after kingdom kills four more in two days
Durham Free School: 'Creationism taught at' free school facing closure
Nearly 100,000 of Britain's poorest children go hungry after parents' benefits are cut
End of the licence fee: BBC to back radical overhaul of how it is funded
Nigel Farage promises Ukip will not 'stigmatise' would-be migrants – and says he wants 'everyone to speak the same language'
Ex-head of MI6: 'We shouldn't kid ourselves that Russia is on a path to democracy'
Most people think legal tax avoidance is just as wrong as illegal tax evasion, poll suggests
iJobs Money & Business
£8 per hour: Recruitment Genius: This Pension Specialist was established early...
£30 - 35k + Bonus & Benefits: Guru Careers: We are seeking an Executive Assist...
£25000 - £30000 per annum + benefits: Ashdown Group: A global leader operating...
Voluntary post, reasonable expenses reimbursed: Reach Volunteering: Would you ...