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Almost all FCA fines via settlement deals – research

by: Professional Adviser
  • 26/08/2014
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Almost all FCA fines via settlement deals – research
Some 97% of the £943m in fines collected by the financial regulator between 2010 and 2013 came from settlements, according to research from law firm Freshfields.

Analysis of Financial Conduct Authority (FCA) cases found the vast majority were concluded through settlement deals, which are an alternative to a formal challenge of the regulator’s enforcement decision and can avoid some of the publicity involved in an appeal, the FT reports.

If a settlement is reached quickly the fined company can avoid 30% of its original fine. However, the report said companies have complained that the settlement deals are made on the regulator’s terms, with “insufficient negotiation”.

The report said the government confirmed only 58% of enforcement cases during the period were settled but they made up 97% of the value of fines.

The report also said the Treasury is conducting a review of the way the FCA and Prudential Regulation Authority enforces rules for banks, insurers and other City operations.

Chancellor George Osborne said in May he wanted to investigate if the bodies were striking the “appropriate balance of fairness, transparency, speed and efficiency”.


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