FSA Record fines

The FSA has issued a record of Fines up 251% on previous record of £89m.

In real terms this means a massive £312 million which is a massive 251 % up from the previous year.

According to a spokes person the fines would of been considerable higher however business's and individuals received lower fine for co-operating with the FSA.

This is the last year that the FSA will be in existence as it will be replaced in 2013 by The Prudential Regulation Authority (PRA) and the Financial Conduct Authority ( FCA ).

It seems that although the FSA who was critisied for not being tough enough on the build up to the credit crunch in its last year it is already making a concerted effort to demonstrate that it is no longer a soft option and is sending out a strong message to companies that they flaunt the FSA regulations at their own risk.

A spokes person for the FSA is reported to have said "FSA fines send a loud message to the market, but it’s the huge restitution schemes ordered by the FSA that make a fundamental difference to a business. The restitution costs for PPI mis-selling are so high that they have actually impacted banks’ balance sheets, potentially affecting their lending capacity."

The Spokes person continued "The banks will probably be more nervous about the FSA ordering them to compensate small businesses for interest rate swap mis-selling next year than about further fines. There are important policy reasons for fines, especially after the serious failings of financial services businesses, but it is important the new regulators don’t get carried away and harm the competitiveness of the UK’s financial services sector.”

Why not get in touch and let us know what you think of the FSA, are the fines too much or not far enought? How the new FSC can regulate the finance industry while maintaining a competitive market?