Rosemarie Paul Quoted by Regulatory Intelligence on Financial Conduct Authority Investigations
Akin Gump London regulatory partner Rosemarie Paul was quoted by Regulatory Intelligence, a Thomson Reuters publication, for its article “More investigations and partial bans, but fewer private warnings likely SMR outcomes,” which discusses the outcomes of initial investigations conducted under the Senior Managers and Certification Regime (SMR).
The SMR is part of a series of policy changes introduced by the U.K.’s Financial Conduct Authority (FCA) and Prudential Regulation Authority to increase accountability in the financial services sector. The article notes that the FCA has initiated at least 13 individual investigations since the SMR came into force in March of last year.
Paul, who was a member of FCA predecessor the Financial Services Authority’s Enforcement and Financial Crime Department, commented regarding these investigations, “The FCA has made it very clear it will be conducting more investigations—some of which may be closed, some of which will be pursued through enforcement—but the FCA has indicated it will investigate more broadly. Another new aspect, depending on the timing of the conduct, is the FCA will be looking at firms' responsibilities maps and tracking conduct through to individual senior managers in a way that's documented and perhaps more transparent than before."
Discussing the range of FCA sanctions facing individuals, she said, “It's important to keep in mind that there are the full prohibitions, which are very onerous, and we'll see more partial prohibitions where an individual may not be fully prohibited.” She added that the nature of the conduct will determine the penalty, noting that someone may be prevented from acting in a senior manager capacity in lieu of a full ban.
Paul also noted that the FCA is moving away from private warnings, as they’re seen as an outdated remedy that lacks transparency.