Financial Times: Tougher teeth needed
“Why should Royal Dutch/Shell have been hit for £17m for market abuse while the largest fine for mis-selling was a mere £1.9m handed out to Lloyds TSB for the precipice bonds affair?”
Wednesday 31 August 2005
By Martin Dickson
Published: August 31 2005
The Financial Services Authority barks a lot about mis-selling of products but does it have enough bite?
Which? the consumer campaigning association, thinks not.
In a paper published yesterday, it calls on the FSA to impose fines so large on companies guilty of mis-selling that their profit is hit and big investors start making waves.
Fines by the FSA’s regulatory decisions committee are something of an evolving black art.
Why should Royal Dutch/Shell have been hit for £17m for market abuse while the largest fine for mis-selling was a mere £1.9m handed out to Lloyds TSB for the precipice bonds affair? True, Lloyds also made £98m in compensation payments but so it should. The arguments against larger corporate fines for really serious offences are that they hurt shareholders rather than their managerial agents and that they may undermine the UK’s culture of co-operation between the regulator and regulated. read more
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