Critics attack European Union plans to follow Basel II

Critics of the European Union's plans to make all investment firms - not just banks - set aside capital against the risk of losses from operational hazards such as fraud, computer breakdowns and trade settlement failures, say their fears were confirmed in February.

Angela Knight, London-based chief executive of the Association of Private Client Investment Managers and Stockbrokers (APCIMS), says her organisation is "horrified" at the possibility of rises in regulatory charges estimated at up to 250% for some investment firms in the lowest-risk category - those not handling client funds.

Critics say it's utterly inappropriate to calculate an op risk capital charge for investment firms on the same basis as that for banks.

The European Asset Management

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