FINANCIAL TIMES: Fear of fining: “FSA”: “And its fining regime is, if anything, still a little on the light side relative to offences. Royal Dutch/Shell got a £17m fine - four times that of the largest previous one - but that was a long way behind the £66m imposed on the company in the US.” (ShellNews.net) 20 April 05

By Martin Dickson

Published: April 20 2005

Please, please don't go the way of those rough, aggressive American financial policemen, imposing heavy fines on us and targeting industry executives.

That was the call yesterday from the British Bankers' Association to the Financial Services Authority, which is conducting a review of its enforcement processes.

The review is not really concerned with the fining regime, but no matter, it is part of the general enforcement fabric and is a matter of concern to the BBA. The association fears that political and media pressures may push the FSA to be too focused on large fines and ensuring reputational damage to firms and individuals. This, it warns, could do untold damage to the existing culture of regulation in the UK, where the open dialogue between regulator and regulated contrasts sharply with the US.

Well, yes, but there is precious little evidence of the FSA going all American. The example the BBA cites - the splits affair - was hardly an example of Spitzer-like terror.

And its fining regime is, if anything, still a little on the light side relative to offences. Royal Dutch/Shell got a £17m fine - four times that of the largest previous one - but that was a long way behind the £66m imposed on the company in the US. And fines on individuals have so far run to no more than a few hundred thousand pounds.

The BBA is rightly concerned that a balance be achieved. But the spectre it raises looks, for now, insubstantial.

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