No finding of dishonesty – dispensed with in quick order
The FCA has privately warned 39 senior executives of financial firms over the last five years. According to figures obtained from the Financial Times, 14 of these executives still hold authorised roles in the financial services industry.
We have commented on the FCA’s use of public warnings previously (see here). By way of a reminder, private warnings are a non-statutory tool used by the FCA to put a person on notice that a breach may have occurred but, for whatever reason, formal action will not be taken on the particular occasion. We noted then that the FCA had raised questions about the compatibility of its practice of issuing private warnings with the organisation's overall transparency objectives.
From the published data it appears that the FCA has not issued any private warnings since the Senior Manager’s Regime came into force in March 2016.
In our view, private warnings have a place in the FCA’s enforcement toolkit and in certain circumstances is a proportionate and appropriate alternative to formal action. To curtail their use entirely would be a mistake. If the FCA has concerns about transparency, then perhaps there should be a concerted effort to promote an understanding of the role and purpose of these warnings rather than seeking to limit their use.
If you would like to discuss this blog in further detail, please contact Louise Hodges, Jill Lorimer or Jonathan Blunden. For further information regarding our Financial Services work, please visit our webpage or contact a member of our Financial Services team.
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