06 Dec, 2011

HSBC was fined £10.5m by the FSA this week for mis-selling investment bonds. According to Mary Stevens, manager of Regulatory Content at Wolters Kluwer UK, thfine pushes 2011 closer to a record breaking year for FSA fines.  


Mary explained: “This massive £10.5 million fine for suitability of advice failures reinforces the view that the FSA’s focus during 2011 has most definitely shifted back to the retail sector.


“The banking sector for example has so far this year seen eight FSA fines totalling £38,027,559.00 (61 percent of 56 total fines in 2011).  Of the eight fines targeted against the banking sector this year two fines have been for failures in complaints handling, two for suitability of advice, one for client asset failures, one for senior management systems and controls, one for investment advice and one for market abuse.  Whilst the regulator is still hacking away at the banking sector it is clear that it is the retail arm that is now being clobbered for such failures.


“Total fines for 2011 have now reached just under £62 million but still £27 million short of last year’s record breaking fines of £89 million.  Although earlier in the year it was expected that 2011 would be much quieter we are now seeing a last minute rally by the regulator to boost its enforcement division’s bank balance. Firms must be prepared to meet complex and stringent regulatory requirements by identifying, monitoring and assessing compliance, operational and financial risk positions across their organisations.”

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