Don't Worry, The FSA Is Going To Stop Your Hedge Fund From Giving You A Bonus Too

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The UK regulatory authority the FSA is expanding their monitoring of bonuses across the financial services industry from a paltry 27 to 2,500 firms, according to the Guardian.

The effort aims to prevent firms from awarding bonuses that may lead to employees taking higher risks.

This FSA move is a product of laws passed just prior to the end of the Labour party’s government in the UK and new laws passed by the European Union.

The new laws will, according to the Guardian:

  • Ban the use of insurance to protect bonuses
  • Require 40-60% of bonuses to be deferred
  • 50% of bonuses must not be paid in cash

This could lead to increasing departures from the City of London, as workers and companies worry about the costs of doing business in the City.

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