UK Contemplates Lifetime Bans For Directors At Failed Banks
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Bank chiefs found responsible for the collapse of their financial institutions should not be “allowed back into the industry again,” said the chairman of the U.K. Financial Services Authority (FSA) on Sunday, in the wake of new rate-fixing allegations that have engulfed Barclays and other banks.
Bank chiefs found responsible for the collapse of their financial institutions should not be “allowed back into the industry again,” said the chairman of the U.K. Financial Services Authority (FSA) on Sunday, in the wake of new rate-fixing allegations that have engulfed Barclays and other banks.
Lord Adair Turner was speaking on the Andrew Marr Show on BBC One when he announced that “more heads will roll” legislation could be brought in to the U.K. financial services industry – including lifetime bans and public prosecution for guilty individuals.
The FSA chairman also claimed that his recommendations would be discussed by the U.K. government this week; with Chancellor of the Exchequer George Osborne said to open to accepting the tougher new regulations.
The FSA, the nation’s financial service watchdog, has come under fire recently for not being able to bring criminal prosecutions against the bankers in the Libor scandal, who artificially fixed the key rate used by banks to set a number of interest rates on loans and mortgages.
Furthermore, it is believed that most of the bankers at the centre of the scandal, particularly those working at Barclays, are still working for their respective banks, despite the FSA fining Barclays £290 million ($454 million) last week.
On Sunday however, Lord Turner rejected suggestions that nothing had been done in the past to toughen the regulatory regime in the U.K.; but he admitted that financial regulations needed to go much further.
“If you go back over 20 years, we started with, in these sort of areas, a very light touch, self-regulatory approach. And slowly over the last 15 years or so we have toughened our approach,” Turner said, as cited by The Guardian.
[quote]”I think we now have to look further and see whether we should strengthen these powers considerably on top of what we have now got at the moment.”[/quote]Related: Who Watches The Financial Watchdogs In The UK?
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Speaking to The Telegraph, Vince Cable, the Business Secretary, echoed Turner’s views and called on more bankers to face criminal prosecutions.
[quote]“They [the public] just can’t understand why people are thrown into jail for petty theft and these guys just walk away having perpetrated what looks like conspiracy,” he said.[/quote]Additionally, Cable believed that U.K. parliament should be carrying out any investigations themselves.
“Parliament and the Treasury select committee is a very effective, and very open and public forum for having people interrogated,” he said. “My instincts are that parliament’s probably the best place to do this.”
