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FSA announces scope of enforcement processes review

Amanda Jarvis

February 3, 2005

The review will be led by David Strachan, FSA director of retail firms and sector leader for insurance. It will consider:
• The processes followed by supervisors, enforcement staff and decision-makers when considering possible breaches of statutory or regulatory requirements and the nature and extent of the communications and interactions between them;
• The role and involvement of senior FSA management throughout these processes;
• The options for a fair procedure under which regulatory decisions are made by
people separate from the investigators; and
• The accountability of decision makers to the FSA Board.
The review will aim to draw upon expertise within the financial services sector, including practitioners and others with direct experience of the FSA's enforcement processes. It will not explore options that would require changes to the Financial
Services and Markets Act 2000.
Speaking to a City audience this evening, John Tiner, will say:
“After three years of operating the existing arrangements for investigations and making enforcement decisions, and in the light of the Financial Services & Markets Tribunal’s recent judgment in the Legal & General case, a review of their effectiveness is timely. “The review will be careful, thorough and wide-ranging, taking in every stage of the process. Work begins next week and we plan to announce the outcome in mid-July. Any significant changes proposed will, of course, be subject to
consultation.”
David Strachan will report to a sub-committee of the FSA Board, which will co-opt as a member Tim Herrington, who took up his position as the new chairman of the Regulatory Decisions Committee on 1 February. The sub-committee will also be
advised by Michael Brindle QC.


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