Confidentiality Of FSA Interview Transcripts And Warning Notices

The Issue

The Court of Appeal1 has examined the extent to which FSA interview transcripts and other material gathered during the course of an FSA investigation is confidential to interviewees and their employers. The decision highlights risks for firms involved in FSA investigation/enforcement processes where they may be facing overlapping civil claims.

The Court has ruled that the s348 Financial Services and Markets Act 2000 does not prohibit a company from disclosing transcripts of FSA interviews with its former or current employees in so far as the transcripts contain information already and independently known to the company.

In the past firms and individuals caught up in FSA investigations may have simply assumed that transcripts of compulsory FSA interviews and indeed any warning notices were confidential in their hands under FSMA. Understandably, given the criminal sanctions which apply to a breach of s348, firms have generally taken a careful approach to the disclosure of such information. However, it is clear from this ruling that the protections in s348 will not cover much of the information contained in this material. Firms must therefore take into account the risks of information provided to the FSA ending up in the hands of civil claimants as part of disclosure in civil proceedings and consider ways in which this risk may be managed.

This is the first time the courts have considered the application of the confidentiality provisions of FSMA and the judgement sets out some principles which firms will need to consider before disclosing this type of information.

The confidentiality provisions in FSMA

Section 348 FSMA provides that confidential information must not be disclosed by (1) the FSA or (2) any person obtaining the information directly or indirectly from the FSA without the consent of (1) the person from whom the FSA obtained the information and, if different, (2) the person to whom it relates. Information is confidential if it relates to the business or other affairs of any person, it was received by the FSA in the discharge of its functions and had not been made available to the public.

Section 391(1) FSMA provides that neither the FSA nor a person to whom a warning notice or decision notice is given or copied may publish the notice or any details concerning it.

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Full Article

The Issue

The Court of Appeal1 has examined the extent to which FSA interview transcripts and other material gathered during the course of an FSA investigation is confidential to interviewees and their employers. The decision highlights risks for firms involved in FSA investigation/enforcement processes where they may be facing...