CliveH Posted August 13, 2009 Share Posted August 13, 2009 Apologies to those bored by my regular rants at how badly the consumer is served by a regulator charged with protecting the consumer but does nothing of the sort (Equitable life for example - Parliamentary Ombudsman report titled "A decade of regulatory failure") But we have just had this appear in our office:- "The FSA are now 'clamping down' on bank staff bonuses!" Unbelievable hypocrisy some would say - (however much they may agree with it). This coming from the organisation that paid each of its own staff members, on average, over £9,000 in bonuses.... ..... albeit that this was on the back of the alleged horrendous 'non' regulation of the banks ...... and albeit that they have apparently just had to borrow £200,000,000 from Lloyds Does this strike you as just one big ludicrous mess? A touch hypocritical perhaps? But forget bonuses for the moment. How do you feel the FSA would fare were they to face a Judicial Review concerning what many people believe are their failures.... indeed possibly their failures to act lawfully?" Well I know how I feel! And yes I feel a judicial review is very much required. Not holding my breath tho'. Sorry! - rant over >:-( Link to comment Share on other sites More sharing options...
spospe Posted August 13, 2009 Share Posted August 13, 2009 Clive The FSA has for long seemed a toothless tiger, or to be honest, a waste of space, so for what it's worth I share your sentiments. :-( Link to comment Share on other sites More sharing options...
CliveH Posted August 13, 2009 Author Share Posted August 13, 2009 How can a regulator be so badly run as to require £200M of borrowing from the very banks it (failed to) regulate? http://www.gaapweb.com/news/1807-FSA-borrows-200m-from-the-banks-it-regulates.html "FSA borrows £200m from the banks it regulates 04 August 2009 In Accountancy News by category Accountancy (761)FSA borrows £200m from the banks it regulates A funding shortfall led to the Financial Services Authority (FSA) borrowing a total of £200 million from the banks it regulates, it has revealed. The FSA had already agreed a £100 million loan facility with Lloyds TSB before the onset of the credit crunch and falling fees combined with rising costs meant this had to be drawn on for the first time. According to the FSA, this was "to fund a short term deficit in our liquid resources towards the end of the year". The regulator also had to agree a further £100 million facility with HSBC. However, the FSA is confident future problems will be avoided. In its report it said: "Despite the large deficit currently reported, we believe that we remain able to meet our liabilities as they fall due because of our statutory power to raise fees." " So those of us who have to pay fees to the FSA can no look forward to further increases. And those increases will have to be passed onto clients. Meanwhile of course the banks who lent them the £200M have forced the FSA to backtrack on the original "message" that came out of the FSA. http://www.citywire.co.uk/Adviser/-/news/adviser-news/content.aspx?ID=353463 Many banks let off the hook over bonus rules By Nicholas Paler | 11:40:00 | 12 August 2009 The Financial Services Authority (FSA) has pushed back the date it will implement new rules on remuneration to next year, while also cutting the number of firms affected by the changes. The regulator said the key change would be the removal of ‘non-UK firms from the scope of the rules unless they are part of a group that contains UK banks and building societies that have total regulatory capital exceeding £1 billion’. As a result of this change, only 26 firms will be affected by the new rules, compared to 47 under the proposals set out in March. As well as reducing the number of firms the new legislation will impact, the FSA added there would be a delay in implementing the new rules – to January 1 2010, from November this year – as firms had complained of a ‘lack of clarity’ about what they would be expected to do." Amazing - but they will get away with the normal "Smoke and Mirrors" weasily words. Link to comment Share on other sites More sharing options...
malc d Posted August 13, 2009 Share Posted August 13, 2009 Just confirms my belief that the city is just one big network of old school chums whose priority is looking after each other. :-( Link to comment Share on other sites More sharing options...
Guest Tracker Posted August 13, 2009 Share Posted August 13, 2009 I was under the impression that the FSA was Grasping Gordon's bright idea when he came to power 12 years ago? Didn't he introduce the FSA at the same time that he gave the BOE control over interest rates - so that he could then blame someone else when the economy went pear shaped? Theoretically the best gamekeepers are ex poachers, but you do need to find the right ex poachers that really are ex poachers and not make believe ex poachers on the make for a quick and easy buck! Link to comment Share on other sites More sharing options...
malc d Posted August 13, 2009 Share Posted August 13, 2009 Tracker - 2009-08-13 7:37 PM I was under the impression that the FSA was Grasping Gordon's bright idea when he came to power 12 years ago? Didn't he introduce the FSA at the same time that he gave the BOE control over interest rates - so that he could then blame someone else when the economy went pear shaped? Theoretically the best gamekeepers are ex poachers, but you do need to find the right ex poachers that really are ex poachers and not make believe ex poachers on the make for a quick and easy buck! Never mind Tracker. Everything will be great after the next general election ! I'm looking forward to it already. ;-) Link to comment Share on other sites More sharing options...
CliveH Posted August 13, 2009 Author Share Posted August 13, 2009 Seriously tho - this is all dissolving into a putrid farce! The Parliamentary Ombudsman states that the FSA oversaw a decade of regulatory failure. The FSA did not have a clue about what the banks were up to, giving Northern rock a clean bill of health just a few months before it collapsed They then get all upset about the bonus culture DESPITE having a bonus culture that clearly rewards failure themselves and state that bonuses in banking will be curtailed Then the FSA has to borrow £200M from those very banks its fails to regulate and then quietly lets it slip out that what it stated categorically was going to happen re Bank Bonuses is being delayed a few years and also being watered down. Banana Republic is what we are rapidly becoming with incestuous relationships between big money and government and a Government more obsessed with celebrities than good governance and due diligence. Link to comment Share on other sites More sharing options...
Brian Kirby Posted August 13, 2009 Share Posted August 13, 2009 Re the borrowings from banks. First I am astounded that a Government Agency is allowed to borrow in this way, but assume it must have had some approval to do so? Second, and perhaps more important, there is surely a conflict of interest? By that, I mean a proper one, that should prevent them from taking on such loans on grounds of professional independence. Link to comment Share on other sites More sharing options...
colin Posted August 13, 2009 Share Posted August 13, 2009 I suspect the FSA have been told "leave us alone or we go elsewhere". The relaxation of banking laws during Maggies time increased UK's banking sector, but if they decide they can do better elsewhere I'm sure they will go, the problem being having let manufacturing go to wall we now rely more on such sectors to generate income. Link to comment Share on other sites More sharing options...
602 Posted August 14, 2009 Share Posted August 14, 2009 Hi, Ref Poachers and Game Keepers, It crossed my mind during the MP's Expenses scandal that by getting rid of those MPs who transgressed, we may be cutting off our noses. What we need is more "crooks with integrity", if you understand what I mean. 602 Link to comment Share on other sites More sharing options...
CliveH Posted August 14, 2009 Author Share Posted August 14, 2009 Certainly there is a conflict of interest which has been flagged up at very senior levels:- FSA's bank loans raise conflict-of-interest concerns SIFMA GLOBAL SMARTBRIEF | 08/11/2009 To pay its increasing expenses, the UK Financial Services Authority has been forced to rely on revolving credit facilities from banks such as HSBC and Lloyds Banking Group, which the watchdog oversees. The situation is raising questions and concerns among regulatory experts and other market participants. "This could be seen as quite controversial," said Selwyn Blair-Ford, a senior domain expert at FRSGlobal. "The FSA borrowing from banks it regulates implies a sense of obligation towards those banks. At what rates were these facilities agreed at? Were they market rates? I think these are important questions that need answering." IFR (08 Aug.) And at consumer level - have a look at this Forum http://www.consumeractiongroup.co.uk/forum/bank-charges-finance-industry/212690-banks-lend-200m-cash.html Link to comment Share on other sites More sharing options...
pkc Posted August 14, 2009 Share Posted August 14, 2009 602, I think there is a good chance we will get them after the next election. Link to comment Share on other sites More sharing options...
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