Fine time for FSA to fill its coffers
The FSA has been clamping down on serious misconduct by hitting financial services firms with nearly £14m worth of fines already this year, according to research by Wolters Kluwer Financial Services.
So far the regulator has issued 16 fines, including a record £7.7m fine on Barclays Bank in January for investment advice failings.
When comparing fines by sector, the banks have been the worst offenders, paying out more than any other sector every year since 2009. In that year, the banks paid £24.2m to the FSA.
In 2010 they paid £61m, and year-to-date they have parted with £11.7m for serious failings.
Meanwhile, insurance companies were fined £6m in 2009 and £7.8m in 2010. However, so far this year they have only been fined £25,000.
In contrast to the multi-million pound sums imposed on the big financial institutions, IFA firms suffered comparatively low penalties. They were fined £236,676 in 2009, £989,100 in 2010 and £143,500 so far this year.
The total number of fines issued by the FSA since its records began has now reached £239.7m.
Mary Stevens, regulatory editorial group UK manager for Wolters Kluwer, said: “Last year was no doubt an amazing year for the FSA’s bank balance and it will be interesting to see what it does with the rewards of its enforcement actions, especially as we edge closer to the new UK regulatory architecture expected to by the end of 2012.”
According to FSA figures, the largest single fine issued in 2010 was paid by JPMorgan Securities, which was fined £33.32m. In 2009, UBS AG paid the highest single fine to the FSA, at £8m.
Simon Gibson, director for East Anglia-based Atkinson Bolton Consulting, said: “The figures don’t necessarily mean that bad conduct has increased.
“It is good that the FSA is cracking down on poor practice, as it hasn’t been sufficiently tough in the past, but there are businesses in all sectors that are well run and can probably be dealt with using a light-touch approach.”