At a Board meeting earlier this month, members agreed to amend the scheme to apply to the length of suspension periods.
Previously, the FSA could only apply a financial discount, usually 30%, to fines imposed on firms if they fully co-operated with the regulator during its investigations.
DB Mortgages, fined £840,000 last week for irresponsible lending practices, had qualified for a 30% discount under the scheme. Without it, the penalty would have been £1.2m.
It was one of a raft of amendments made at the meeting on 24 February.
The FSA says authorised firms must not pay financial penalties imposed on its employees.
Additionally, the regulator has outlined its policy for publishing decision notices.
Previously, the FSA could only publish final notices but, following an amendment made by the Financial Services Act 2010 to section 391 of the Act, it can now publish decision notices as well.
