The government has published a series of recommendations to help the Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA) make enforcement decisions to be fair, transparent and efficient.
The Treasury announced a review of the institutional arrangements and processes used by the FCA and PRA to make enforcement decisions in May this year.
Following the conclusion of the review, the government’s recommendations include:
- new independent decision-making committee for the PRA, with a dedicated and independent chair
- new, sign-posted, expedited procedure to access the Upper Tribunal so that those who wish to access this independent judicial process can do so directly
- regular independent review of the regulators’ settlement processes
- measures to enhance the accountability of the FCA and PRA’s decision makers, including by publishing annual reports and increasing their accountability to Parliament
- removal of penalty discounts where those being investigated delay settlement
- steps to encourage those being investigated to make early admissions to resolve cases more quickly
- FCA and PRA should publish more information about their criteria for starting investigations, and their approaches to referring cases from supervision to enforcement, with more transparency around how the FCA and PRA co-operate with each other
- more constructive communication between investigators and those being investigated, with greater senior involvement by the regulators
George Osborne said: “Today’s recommendations will enhance the FCA and PRA’s capacity to deal with misconduct or tackle threats to financial stability swiftly, fairly and robustly.
“The review sits alongside the significant steps that the government has already taken to improve standards in banking and financial services, including by replacing the failed tripartite regulatory system.”
