
UK FSA fines firm £560,000 for breaches
LOSSES & LAWSUITS
"The implementation and maintenance of appropriate systems and controls is essential to maintaining market and consumer confidence in the financial system and individual firms," says Margaret Cole, head of enforcement at the regulator. "A firm that fails to meet these basic requirements can pose significant risks to its clients and ultimately its own financial health."
Overall, the FSA found that WDM had breached four of the FSA Principles for Business as well as relevant FSA rules on client money. The primary effect of these failures was that WDM was unable to monitor its own financial position or to comply with its financial reporting requirements adequately, said the FSA in a statement. This resulted in the firm making total provisions of £66.3 million in its accounts for 2004 and 2005 in respect of assets viewed as irrecoverable. These provisions in turn led to concerns about the firm's solvency and to its former parent company, ING, waiving loans totalling £58 million to ensure it remained adequately capitalised.
Cole adds: "In determining the level of penalty, the FSA has taken into account the fact that WDM and ING identified potential regulatory issues at the firm in 2005 and acted properly and responsibly in reporting these to the FSA. The firm, ING and, since it acquired the firm, Evolution Group plc, have been open and co-operative with the FSA in bringing this investigation to a prompt conclusion."
Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.
To access these options, along with all other subscription benefits, please contact info@risk.net or view our subscription options here: http://subscriptions.risk.net/subscribe
You are currently unable to print this content. Please contact info@risk.net to find out more.
You are currently unable to copy this content. Please contact info@risk.net to find out more.
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. Printing this content is for the sole use of the Authorised User (named subscriber), as outlined in our terms and conditions - https://www.infopro-insight.com/terms-conditions/insight-subscriptions/
If you would like to purchase additional rights please email info@risk.net
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. Copying this content is for the sole use of the Authorised User (named subscriber), as outlined in our terms and conditions - https://www.infopro-insight.com/terms-conditions/insight-subscriptions/
If you would like to purchase additional rights please email info@risk.net
More on Regulation
More EU banks will fail new IRRBB test as rates push upwards
Half of all EU banks could cross outlier threshold for new test of net interest income
Finra head recognises ‘challenges’ for bond transparency drive
Cook says regulators thinking about industry’s operational and liquidity concerns
Why central banks shouldn’t ignore stablecoins
Rapid growth of stablecoins could impair monetary policy transmission
Hedge funds doubt tall tales around UK short-selling review
FCA has never used powers to ban short-selling, but reporting tweaks would be welcome
Cost of bank bail-in rules lower than expected – EBA
MREL pricing manageable for most banks, though troubled firms may struggle to meet targets
Ice Clear Credit may face Esma review as euro CDSs migrate to US
Upgrade in systemic status would depend on extent of migration from UK-based Ice Clear Europe
EU takes steps to avoid India clearing house lockout
Other Asian regulators may also have concerns about extraterritorial reach of Emir 2.2
HKMA preparing prescriptive climate stress test for 2023
Regulator plans granular scenario specifications, considers Pillar 2 capital measures