FCA abandons seven investigations due to ‘lack of evidence’

FCA intray overworked files folders

The FCA has abandoned seven investigations into individuals since 1 January 2015 because of a lack of evidence, Money Marketing can reveal.

Money Marketing filed a Freedom of Information request after it was revealed in August the regulator ceased its investigation into Lloyds Banking Group head of gilts trading Tony Gray because there was no case for him to answer. The investigation into Gray concerned the manipulation of the government bond market.

Responding to the FOI, the regulator did not provide information about the nature of the seven formal investigations because it considered disclosing those details would lead to potential identification of the individuals.

Compliance and Training Solutions director Mel Holman says the regulator should not be criticised for starting investigations only to later throw them out.

Holman says: “That is what the regulator is there for. They have been accused so many times of, ‘why aren’t you looking into this, it’s been whistle-blown’. At least they are doing something.

“Isn’t it better that somebody gets investigated and they are happy there is no further evidence and therefore dropped – you can’t say it is a waste of money.”

The Financial Inclusion Centre co-director Mick McAteer agrees. He says: “It is right and proper that if the FCA finds out there is not sufficient evidence that the case should be dropped. That is showing there is proper process working.

“If you don’t have some preliminary investigation how do you know whether they take it on further? If you adopted a far too cautious approach then it would be difficult to uncover evidence about anybody.

“It is a huge market and there are still a lot of unscrupulous practices going on and the regulator has to work hard to uncover the evidence.”

Holman says going through an investigation is stressful, even if it is later discontinued.

She says: “Whenever I speak to our clients it puts the fear of God into them. Of course it is a worry and a burden and it is stressful. When it is dropped there will be a mixed feeling of relief.”