Britain's financial regulator has been 'secretly' warning City executives

LONDON — Britain’s regulator, the Financial Conduct Authority (FCA), has privately warned as many as 40 senior figures within City financial firms in the past five years, it was revealed on Sunday.

The nature and reasons for the warnings have not been revealed, but in the past, private warnings have been issued to City figures in relation to the LIBOR-rigging scandal which came to light in 2012.

According to a report from the Financial Times, which cites a Freedom of Information request, 39 senior figures, including 14 chief executives, have been censured in private by the regulator. The warnings were described by the newspaper as “secret.”

Private warnings from the FCA do not indicate that individuals have taken part in any wrongdoing, but simply indicate that it may have occurred.

Their usage in the past has been contentious, as a private warning does not require the FCA to undertake a full investigation into conduct, but can cause problems for individuals when moving jobs as warnings must be disclosed to employers.

The regulator “is currently reviewing its policy in relation to the use of private warnings and we will determine our approach to future use of this tool in light of responses to the consultation,” it said in a statement given to the Financial Times in response to the findings of the FOI request.

The practice has also been criticised for its lack of transparency, with Labour MP John Mann, a member of the House of Commons’ Treasury Select Committee — which scrutinises the financial sector — saying: “Transparency is key.”

“Anything that allows things to be dealt with in secret is damaging to the whole culture of financial services, and opens the regulator up to challenge.”

You can read the Financial Times’ full report here.

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