City watchdog, the Financial Conduct Authority (FCA), is expected to hand out more fines this year as it steps up regulatory scrutiny and enforcement of new rules as its broadens its focus, according to new research.
The implementation of new rules and the broadening of the regulator’s attention to smaller firms could see the level of fines rise back up to levels experienced in the years prior to 2016 and since the financial crisis, law firm Fox Williams said.
Fines levied in 2016 were the lowest since 2007 and in the wake of the Libor and Forex rate-rigging scandals uncovered in 2012. It was thought that the lack of fines was in response to increased scrutiny or that the regulator had softened its approach to misconduct, the law firm said
But the firm’s analysis suggested the FCA is turning its attention to firms that impact directly on the public as well as trading floors.
“After several years dominated by Libor and Forex offences, the regulator showed signs last year of casting its net far wider. Firms and activities which have a more obvious impact on the general public are once again entering the FCA’s sights. Big banks and trading floors have been the popular target for several years, but now it is the turn of smaller firms, independents, insurers, credit companies and anyone handling client money to be in the spotlight, ” Peter Wright, partner and head of financial services investigations at Fox Williams.
“If Libor was the poster child of misconduct over the past five years, financial crime will take its place this year. In addition, 2017 is the year in which the application of several new rules will really start to take effect,” he said.
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