FSA chief warns of risk from rising litigation

Callum Mccarthy, the chairman of the Financial Services Authority, appealed to the City to have more faith in the regulator's enforcement process last night, warning that the UK is at risk of losing its advantage as a less litigious society than the United States.

Callum Mccarthy, the chairman of the Financial Services Authority, appealed to the City to have more faith in the regulator's enforcement process last night, warning that the UK is at risk of losing its advantage as a less litigious society than the United States.

Speaking at the Lord Chancellor's Mansion House reception, Mr McCarthy said the growing number of appeals against FSA decisions was a worrying trend.

He said: "Access to an open, independent and impartial judicial process is a fundamental right and we welcome the role played by the tribunal. But I think we should all recognise that if this occurs it inevitably leads to delay and to additional costs.

"I continue to hope that we can maintain confidence in our Regulatory Decisions Committee process and promote efficient, orderly and clean markets without a dramatic increase in the number of cases referred to the tribunal. It is in all our interests. The UK has traditionally enjoyed over North America the advantage of being a less litigious society."

The FSA has seen a flurry of cases referred to the tribunal over the past few months, of which the most high profile has been Legal & General's appeal against a £1.1m fine.