Financial watchdog FSA to issue fewer fines for banks
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Your support makes all the difference.Fines levied on companies by the Financial Services Authority (FSA) are set to fall this year for the first time since the economic crisis began, its figures show.
With the year end approaching, the City watchdog has imposed £49m of penalties compared with the record £89m haul for all of 2010.
The FSA insisted that it had kept up its hard line on wrongdoing and that excluding two huge fines of nearly £51m imposed last year, the trend was little changed. It has handed out fewer fines this year, with 51 meted out in 11 months compared with 80 for all of 2010. The FSA has chosen to target individuals for market abuse, mis-selling and other wrongdoing.
Tracey McDermott, the FSA's acting director of enforcement, said: "Obviously getting our message out there is important but we aren't setting out to say, 'Let's make this year's total better than last year's total.' We want to get the right cases in the right volume with the right penalties."
The fines to date already make this year's haul the second-biggest for the FSA, whose enforcement arm will be split off into a new Financial Conduct Authority next year.
The watchdog has ramped up penalties since the start of the financial crisis after admitting it had been too soft. In 2007 it collected just £5.3m but the figure climbed to £23m in 2008 and £35m in 2009. This year included two of the FSA's top 10 penalties: £7.7m for Barclays after faulty selling of funds, and £6.9m for anti-corruption failings at the insurance company Willis.
The regulator also imposed its biggest penalty on an individual – £6.9m of fines and restitution imposed on Rameshkumar Goenka, a Dubai-based private investor.
The fall in the total from last year follows two blockbuster fines in 2010. The £33.3m collected from JP Morgan and the £17.5m from Goldman Sachs remain the FSA's two biggest penalties. Excluding the two biggest fines from each year leaves 2011 just £4m short of last year's total, with the possibility of more penalties in December.
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