couter_rdolan_tBy Rachel Couter and Olivia Short King & Wood Mallesons’ dispute resolution and contentious regulatory group

On 14 April 2016, the Financial Conduct Authority (FCA) and the Prudential Regulatory Authority (PRA) published their consultation paper proposing various changes to the enforcement process in response to the following three publications:

  1. HM Treasury’s “review of enforcement decision-making at the financial services regulators”, dated 18 December 2014;
  2. the PRA’s and FCA’s joint report, “the failure of HBOS”, dated 19 November 2015; and
  3. Andrew Green QC’s “report into the FSA’s enforcement actions following the failure of HBOS”, dated 19 November 2015.

The suggested reforms are underlined with a desire to increase the level of transparency and efficiency for those subject to the enforcement process. Comments have been requested by 14 July 2016.  The main proposed substantive changes relate to the settlement process and the ability to “leapfrog” the Regulatory Decisions Committee (RDC) and refer the matter straight to the Upper Tribunal.  These are considered in more detail below, together with proposals to increase transparency within enforcement proceedings, but there are further proposals to improve the referral process as well as to increase cooperation between the two regulators when the same matter is of relevance to both.

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