FSA CHIEF EXECUTIVE OFFICER STANDS DOWN

The Financial Services Authority has announced that Hector Sants will leave the organisation in the summer of 2010, after three years as chief executive officer.

Mr Sants said:

“When I was appointed I told the board that I planned to serve as CEO for three years, and I intend to stick to that timetable. Of course, those three years have encompassed the most extraordinary circumstances for a financial regulator, and I am very proud of the manner in which the FSA rose to the challenge of dealing with such unprecedented turbulence across global financial markets.

"Moreover, I believe the FSA candidly examined the failings in financial regulation that contributed to the onset of the crisis, learned the lessons and has gone on to reform itself into a much stronger and better equipped organisation.

“The success of any regulatory structure depends on ensuring supervision is carried out by high-quality supervisors with sufficient resources and specialist support.

"I believe the FSA has made great strides in ensuring that such individuals are in place in the UK and I am sure that after I leave they will continue to do invaluable work to ensure financial stability and protect the interests of consumers.”

Adair Turner, chairman of the FSA said:

“Hector has given outstanding service and leadership through the turbulent last three years and has played a pivotal role in reforming the FSA into a truly effective organisation. He will leave behind an organisation with strong purpose and a clear strategy.

"We will be immensely sorry to lose him, but understand his decision to move on in the summer and wish him well in whatever he chooses to do after his departure. In the meantime, we will continue to work together to deliver the FSA’s reformed and intensive supervisory approach and drive forward the global regulatory reform agenda.”

The board of the FSA will announce the process for deciding the succession to Hector Sants in due course.

WHO DO YOU THINK WILL REPLACE HECTOR?



There’s a bottle of champagne for the correct answer and a bottle of champagne for the most interesting suggestion!!! Please submit your correct and/or your light-hearted answer here

Source: Financial Services Authority

FSA Website

FSA – HECTOR SANTS ISSUES JAIL THREAT

Hector Sants, FSA Chief Executive Officer, has issued a stiff warning to financial firms including the threat of jail for those flouting the rules.

Firms had still failed to accept a "collective responsibility" for the financial crisis. He said that the FSA would now step in to police financial products before they were offered to customers. A string of recent fines were levied only after consumers lost money.

The FSA has stepped up action against fraudulent mortgage brokers, firms mis-selling payment protection insurance, and companies mistreating customers in arrears on their home loans. As a result, it levied a record number of fines in 2008-9, which could be outstripped in 2009-10, and banned a number of individuals from the financial services industry.

However, in a speech in London on Monday this week, Mr Sants explained why the FSA should no longer be seen as a "light touch" regulator.

"I have made clear that when firms do not adjust their behaviours they can expect tough action from the FSA, either to require them to do so, or when that is not possible, to require them to mitigate risks their actions have created," he said.
"And yes, that does mean people go to jail."

He said the FSA wanted to protect consumers and secure firms that were financially stronger and more resilient.

"It is important to recognise that the FSA will not presume that the firms we supervise have learned the lessons of the past. There remains, I believe, an absence of the acceptance of collective responsibility for what has happened. I personally remain unconvinced that all senior management have taken on board the need to change and operate in a genuinely different manner."

The spotlight would be thrown on senior management, with the FSA leading a discussion on how to asses a senior executive's impact on an institution's culture. He said regulation should ensure these people were technically equipped and of the required integrity.

Mr Sants revealed that the regulator had told some banks or building societies to rein-in their activities in a bid to protect consumers. In other cases, it had prevented some from entering the financial services market at all. However, he said there was a limit to how much a regulator could ensure everything was done properly.

He said, "It would be a mistake not to recognise that some of the failures which have occurred have their roots in issues of culture and behaviour".

The Conservatives have pledged to fundamentally change the FSA if the party wins power and hand back supervisory powers to the Bank of England.

Does the FSA make you nervous?

Are you kept awake at night worrying about your lack of FSA regulatory controls?

Does your blood run cold at the thought of what the FSA could do to you?

If you answered yes, you are not alone.

Whether it’s risk assessment work, business monitoring, TCF audits or FSA visit preparation, The Consulting Consortium (TCC) will provide you with a range of cost-effective solutions to meet all your FSA regulatory needs. Please call us on 020 7645 8808 to find out how we can help you.


Source: BBC News

BBC Website

FSA AND POLICE LAUNCH “OPERATION WARN”

The Financial Services Authority (FSA) and City of London Police have this week written to 6,500 homes across the UK to warn people that their details are on a ‘master’ list being used by share fraudsters to target people and sell them worthless shares.

The master list contains the names of about 10,000 people, some with addresses and phone numbers. The list was discovered by the FSA and City of London Police who launched Operation WARN because of serious concerns that it was currently being circulated among fraudsters.

The letter, which is the first stage of Operation WARN, explains what people on the list can do to protect themselves from the fraud. As well as acting quickly to alert those on the list, the FSA and City of London Police have launched a new secure consumer helpline 0845 602 2185 so people who have received the letter can call in for further information.


Source: Financial Services Authority

FSA Website

FSA AND BoE – MOU ON OVERSIGHT OF PAYMENT SYSTEMS

This MoU sets out the arrangements for co-operation and division of roles and responsibilities agreed between the Bank and the FSA regarding FSA-regulated organisations and payment systems, with a particular focus on the division of responsibilities for the regulation of embedded payment systems that have been recognised under the Banking Act.

The document is split into four sections:

1) Roles and responsibilities regarding FSA-regulated organisations operating recognised payment systems.

2) Roles and responsibilities regarding other FSA-regulated organisations and standalone payment systems.

3) Roles and responsibilities regarding the Settlement Finality Regulations.

4) Arrangements for information sharing and supervisory cooperation.


Source: Financial Services Authority

FSA Website

FSA AND SEC – HOLD FIFTH MEETING OF SEC–FSA STRATEGIC DIALOGUE

The FSA chairman Lord Turner and chief executive Hector Sants, and US Securities and Exchange Commission chairman Mary Schapiro met as part of the SEC-FSA Strategic Dialogue.

The purpose of the Dialogue, which was established in 2006, is to engage at the senior levels of the two agencies on current matters affecting the US and UK capital markets and areas of future collaboration. This was the fifth meeting of the Dialogue.

Some of the areas of mutual interest discussed during the meeting included:

• Corporate governance and executive compensation;

• Regulation of hedge funds and investment advisors and the protection of customer assets;

• Disclosure regimes around client asset risks;

• Market infrastructure, particularly relating to central counterparties for OTC derivatives;

• Market supervision;

• Cooperation on cross-border supervision.

At the meeting, Schapiro, Turner, and Sants agreed that, given the linkages between the US and UK markets, enhanced supervisory cooperation is critical to market integrity.

Cooperative efforts between the staffs of the two agencies are increasing in areas such as oversight of credit rating agencies, hedge fund advisers and the clearing of OTC derivatives. To facilitate this expanding cooperation, the two agencies plan to review the existing Memorandum of Understanding Concerning Consultation, Cooperation and the Exchange of Information Related to the Supervision of Financial Services Firms and Market Oversight, entered into by the SEC and the FSA in 2006.

This memorandum of understanding is designed to promote the coordination of robust and sound supervision of cross-border financial institutions and markets.

The Dialogue also provided the opportunity for the SEC and the FSA to continue discussions in the areas of corporate governance, particularly board risk oversight, and executive compensation. Consistent with the emerging international consensus, both agencies’ current efforts seek to address, among other things, the intrinsic links between the types and degree of risks regulated entities/registrants assume and their corporate governance and compensation policies.


Source: Financial Services Authority

FSA Website

ABI – CONCERN OVER APPROACH OF REGULATORS ON SOLVENCY II

Responding to CEIOPs third and final set of advice on Solvency II implementing measures, Peter Vipond, Director of Financial Regulation at the ABI, said:

“We are concerned about the continuing overtly cautious approach of regulators, whose desire for firms to hold extra capital is a step change from the original, and welcome, aims of Solvency II. It is excessive and fails to recognise both the strength of the life and general insurance industries, and how insurers work.

“Solvency II has the potential to provide many benefits to consumers and insurers, but, more work on its development is required. We will continue to work with the Commission and other stakeholders to find a suitable solution to these issues.”

Do you need help implementing and meeting the Solvency II requirements? Call us on 020 7645 8808 to find out how we can help.


Source: Association of British Insurers

ABI Website

CML – LENDING FIGURES POINT TO SLOWER JANUARY

The latest Bank of England mortgage data confirms the likelihood that there may have been a "bunching" of house purchase transactions in December to beat the stamp duty concession deadline.

The gross lending total of £13.4 bn in December 2009 was in line with the CML's estimate (£13.5 bn) and seems to confirm the CML's view that much activity was “rushed through” to beat the stamp duty deadline. Gross lending totalled £143.5 bn in 2009.

Net lending remains up from the near stagnation in the middle of the year. For 2009 as a whole net lending totalled £11.5 bn. This was the lowest level on record (back to 1987), but higher than the CML forecast of £8 bn. It was largely driven by the relative strength of house purchase activity, which picked up over the latter part of the year, and weak levels of repayments. The CML sees little if any evidence that households, in aggregate, are using low interest rates to pay down mortgage debt more quickly.

CML economist Paul Samter said:

"These figures confirm that the mortgage market ended 2009 in much better shape than it started, but it still looks like a slow haul back to meaningful levels of activity. It should be no surprise if January and February this year appear particularly slow, if we are correct in our view that many buyers rushed to beat the stamp duty concession deadline in December."


Source: Council of Mortgage Lenders

CML Website

FOS – BANKS AND COMPLAINTS

The Financial Ombudsman Service has held a forum for banks to:

• Talk about the types of complaints the ombudsman continues to see

• Discuss how banks plan to improve the handling of customer complaints and

• Reduce the number of unnecessary referrals to the ombudsman.

If you and your team don’t have the time or skills to deal with complaints, we can help. We deal with the Financial Ombudsman Service (FOS), third party complaint handling companies and directly with customers for a number of high profile clients.

We offer a service that takes the pain out of complaints – we can design an end to end process and provide the skilled resources to support your firm or call 020 7645 8808 to find out how we can help you.


Source: Financial Ombudsman Service

FOS Website