UK: Weekly Financial Services Regulatory Update - Week To 20.07.12

Consultation papers:

No new developments this week.

Discussion papers:

No new developments this week.

Policy statements:

19 July: Regulating bidding for emission allowances under Phase Three of the EU Emissions Trading Scheme: Feedback to CP12/6. The FSA has published a Policy Statement outlining the feedback received to its Consultation Paper on regulating bidding for emissions allowances under Phase Three of the EU Emissions Trading Scheme. The paper sets out the near-final rules which will be finalised at a Board meeting on 26 July 2012.

Press releases:

19 July: FSA secures redress for victims of boiler room scam. The FSA has successfully obtained a court order against Sinaloa Gold Plc and one of its directors, which will ensure that the 79 victims of the firm's boiler room scam will receive some of their money back. Over £1 million has been ordered to be paid to the FSA to distribute amongst the victims alongside an order not to dispose of any assets worldwide until payment has been made.


20 July: Macro-prudential policy in deflationary times. The FSA has published a speech given by Lord Turner, Chairman of the FSA, during the Financial Policy Committee ("FPC") regional visit to Manchester. In his speech, Turner sets out the key reasons for the financial crisis and how the financial services industry has since been attempting to rectify its errors, particularly as regards structural reform and the introduction of the FPC. He also sets out the challenges that he believes the FPC faces in the future and how it would deal with deflationary risk differently in light of its new policies.

Bulletins and newsletters:

No new developments this week.

Final notices:

17 July: John McNamara. The FSA has issued a final notice, dated 17 July 2012, cancelling the Part IV permission that had previously been granted to John McNamara as he has not conducted any regulated activity in the past 12 months and Mr McNamara has failed to cancel the permission himself.

17 July: Brian Leslie Lambert. The FSA has issued a final notice, dated 17 July 2012, prohibiting Brian Lambert from performing any function in relation to any regulated activity. Mr Lambert was convicted, on 5 September 2011, of conspiracy to defraud and was sentenced to 27 months imprisonment. This conviction has led the FSA to conclude that Mr Lambert is not a fit and proper person as his conduct demonstrates a lack of honesty and integrity.

16 July: Swift Travels & Estate Agents Limited. The FSA has issued a final notice, dated 16 July 2012, cancelling the registration of Swift Travels & Estate Agents Limited ("Swift") as a small payment institution. Swift has failed to pay fees and levies owed to the FSA in the amount of £559.60, despite repeated requests that it does so, and the FSA has therefore concluded that Swift has failed to demonstrate a readiness and willingness to deal with the FSA in an open and co-operative manner.

16 July: Quintillion Asset Management Limited. The FSA has issued a final notice, dated 16 July 2012, cancelling the Part IV permission granted to Quintillion Asset Management Limited ("Quintillion"). Quintillion has failed to pay fees and levies owed to the FSA in the amount of £8,407.02, despite repeated requests that it does so, and the FSA has therefore concluded that Quintillion has failed to conduct its business soundly and prudently in compliance with the Threshold Conditions and is therefore not a fit and proper person.

16 July: GMEX Europe Limited. The FSA has issued a final notice, dated 16 July 2012, cancelling the registration of GMEX Europe Limited ("GMEX") as a small payment institution. GMEX has failed to pay fees and levies owed to the FSA in the amount of £797.10, despite repeated requests that it does so, and the FSA has therefore concluded that GMEX has failed to demonstrate a readiness and willingness to deal with the FSA in an open and co-operative manner.

Application refusals:

No new developments this week.

Approved person refusals:

No new developments this week.

Research publications:

No new developments this week.

Consumer research:

No new developments this week.

Other FSA publications:

19 July: Solvency II. The FSA has updated its Solvency II webpage to announce that it is now working towards the amended transposition date of 30 June 2013, and implementation by firms from 1 January 2014.

18 July: One-minute guide - Gender Directive. The FSA has published a one-minute guide to the Gender Directive in the wake of the Test-Achats judgment. From 21 December 2012, insurers will no longer be able to use gender as a rating factor when pricing risk or paying benefits. The guide sets out how firms can comply with the judgment, how product prices will be affected and states that non-compliance will be dealt with on a firm-by-firm basis.

18 July: FSA publishes question bank for IMAP firms with life insurance obligations. The FSA has published the "question bank" for life insurance firms to facilitate the first stage of the FSA's two-stage approach to the review of technical provisions in readiness for Solvency II. The most appropriate questions will be selected by Supervisors for their firms and discussions will begin in July 2012. The second stage will focus on the calculation of technical provisions and will be completed in the first half of 2013.

17 July: Memorandum of Understanding ("MoU") between the FSA and the Reserve Bank of India. The FSA and the Reserve Bank of India (the body responsible for the regulation and supervision of banking organisations in India) have entered into a MoU which will provide the formal basis for co-operation between the two bodies in the area of banking supervision to enable them to more effectively perform their functions.

16 July: Handbook Release 127. The FSA has issued a supplementary Handbook release containing updates to the Handbook Listing Rules, Prospectus Rules and the Disclosure Rules and Transparency Rules, issued to correct errors in the original Release 127.

UKLA publications:

No new developments this week.

Upper Tribunal (Tax and Chancery Chamber) (formerly Financial Services and Markets Tribunal (FSMT)):

20 July: Mark Anthony Financial Management and Mark Anthony Hurst Ainley v FSA (FS/2011/0020 & 0021). The Upper Tribunal has published its decision in the case of Mark Anthony Financial Management ("MAFM") and Mark Anthony Hurst Ainley v FSA. The FSA decided that Mr Ainley had submitted false and misleading mortgage applications, knowing them to be false, which rendered him not fit and proper to be approved. Mr Ainley had further submitted knowingly false or misleading statements to the FSA. The FSA had decided to withdraw his approval, prohibit him from performing any regulated activity and impose a financial penalty of £150,000. MAFM's Part IV permission was also cancelled. Mr Ainley referred the matter to the Upper Tribunal, claiming that the FSA's response was disproportionate. The Upper Tribunal held that Mr Ainley had acted without integrity and was not a fit and proper person. Excepting the financial penalty, all of the FSA's decisions were upheld. The appropriate level of financial penalty will be reviewed at a subsequent hearing but the Upper Tribunal has stated that Mr Ainley's conduct does warrant a substantial financial penalty.

Financial Ombudsman Service (FOS):

20 July: Consumer factsheet on Natwest's, RBS's and Ulster Bank's computer problems. The FOS has published a consumer factsheet due to the number of complaints it has received relating to these banks' recent computer problems. The factsheet recommends speaking directly to the bank in the first instance before also explaining what the consumer may be able to claim for.

London Stock Exchange (LSE):

19 July: Burberry celebrates 10 years on the London Stock Exchange. Burberry was first listed on the LSE in July 2002. Ten years later its share price has increased by 436% and its revenues are up 272%. Burberry's chief executive officer opened London trading on 19 July to mark the occasion.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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