FCA outlines new process for individuals under investigation

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The FCA is introducing a new process for partly contested cases to allow a person under investigation to agree elements of a case and contest others before its Regulatory Decisions Committee.

The person being investigated could agree the penalty, facts and liability, or a combination of these. It will still be possible to get a discount on the penalty if certain elements of the case have been agreed.

The regulator is also providing a mechanism for people under investigation to proceed more directly and quickly to the Upper Tribunal.

It is also abolishing penalty discounts at certain stages of the settlement and using the same panel that gave the warning notice to decide whether to give a decision notice.

In a policy statement published today, the FCA and the Prudential Regulation Authority outline changes in the following areas:

  • how decisions are made about whether to refer an issue to enforcement and markets oversight or the regulatory action division for investigation;
  • the provision of more information to the subject of an investigation about why they have been referred for investigation;
  • regular updates throughout an investigation, as well as ensuring there is increased engagement with the subject;
  • effective levels of dialogue between enforcement and supervision during an investigation; and
  • producing more detailed guidance on the process for joint FCA/PRA investigations

FCA enforcement and market oversight director Mark Steward says: “It is essential that our enforcement decision-making processes command public confidence and operate both efficiently and fairly. The changes set out in today’s [policy statement] are designed to achieve just that and reflect the views of stakeholders who responded to our consultation.”