CCR Magazine

Subscribe Here
You are here  :Home arrow News arrow Putting individual accountability at the heart of banking
Contact Us Newsletter Signup RSS Feeds

Latest News Headlines

Headlines

 
Commercial Credit News

Headlines

 
Putting individual accountability at the heart of banking PDF Print E-mail
Friday, 08 January 2016

In the wake of the banking crisis and the recent LIBOR and FX scandals, the political, regulatory and public clamour for senior individual accountability has reached fever pitch. Much criticism has been directed at the regulator’s perceived failure to bring to account those individuals considered to have been ultimately responsible for serious transgressions within financial institutions.


Written by David Berman, Head of Financial Services Regulation at Macfarlanes LLP

In response, the government and regulator introduced the Senior Managers Regime (SMR). In large part, the SMR is designed to facilitate senior individual enforcement actions and overcome the (often insurmountable) evidential hurdles that have frustrated the regulator in the past.

Somewhat ominously (if not at all unsurprisingly), the latest FCA Business Plan set out the regulatory stall in relation to the ‘hot’ topic of senior individual accountability:

“The accountability of individuals in positions of responsibility needs to be improved and overall standards of governance raised. The new Senior Managers Regime will make it easier for both firms and regulators to hold individuals to account”.

The SMR supplements other (continuing) regulatory initiatives similarly intended to facilitate the regulator’s pursuit of senior level individuals – namely, a marked increase in regulatory attestation requests and the new-found phenomenon of culture-based enforcement (‘cultural attribution’). Both of these latter topics will be covered in subsequent blogs.

Senior level individuals within UK-regulated financial institutions are therefore now (and will likely remain) firmly under the regulatory spotlight, facing an unprecedented threat of adverse scrutiny.

Understanding and managing the risks
It is therefore vital that designated senior managers understand the most likely sources of personal regulatory exposure and address how these risks can be effectively managed down to acceptable levels in practice. For example, by considering such questions as:

What does the regulator expect of me?
What is the scope of my regulatory responsibility?
To what extent can I be held responsible for the (in)actions of others?
Where is my greatest exposure?
What is the regulator’s most likely avenue of challenge?
How do I satisfy the new duty of responsibility?
How can I reconcile my statutory duties as a director with my regulatory responsibilities?

These questions (amongst others) are answered in Individual Accountability Under the Senior Managers Regime – A Practical Guide (Thomson Reuters), by David Berman, Head of Financial Services Regulation at Macfarlanes LLP.
 

 Forums International Ltd

Forums International Ltd

 Attendance at your first meeting is free of charge, and please quote reference 'CCR2016' to receive the special 10% discount off of your first annual subscription.

Find out more here.

latest issue

CCR Cover

The latest edition of CCR Magazine, the leading editorial publication in the UK credit industry, is out.

Read the latest issue online

CSA

subscriptions

CCR is the premier magazine for consumer and credit professionals. It provides an independent voice to the industry, breaking major news stories and running in-depth features.

As a magazine, it works with and campaigns on behalf of the credit industry to promote its importance as a centre of potential profit and business development to the wider business world.

Subscribe to CCR Magazine

CCR World Magazine


 

Providing information and analysis for thousands of senior credit professionals worldwide, every quarter.

Find out more

GTS Media Ltd
81 Cambridge Road
Southend-on-Sea
Essex
SS1 1EP

Registered in England No: 05483197