Weekly Financial Services Regulatory Update - 18.05.12

Consultation papers:

No new developments this week.

Discussion papers:

No new developments this week.

Policy statements:

No new developments this week.

Press releases:

16 May: FSA decides to ban BGC senior executive, Anthony Verrier. The FSA has published a decision notice prohibiting Anthony Verrier from performing regulated activities within the financial services industry. The FSA based its decision on comments made by the High Court in Tullett Prebon plc (and two others) v BGC Brokers LP (and 13 others, including Verrier), [2010] EWHC 484 (QB) indicating that Mr Verrier had participated in an "unlawful means conspiracy" and had been untruthful with the court. Approved persons are required to act with honesty and integrity and the FSA decided that the judge's comments raised serious questions in relation to Mr Verrier's conduct. Mr Verrier has referred the matter to the Upper Tribunal.

For the related decision notice, please see the 'Other FSA Publications' section of this update.


15 May: FSA fines Habib Bank AG Zurich £525,000 and Money Laundering Reporting Officer £17,500 for anti-money laundering control failings.

The FSA has imposed fines of £525,000 and £17,500 on Habib Bank AG Zurich ('Habib') and its money laundering reporting officer, Syed Itrat Hussain, respectively. The FSA has concluded that Habib had exposed itself to an unacceptable risk of money laundering over a three year period due to its failure to have adequate anti-money laundering ('AML') systems and controls in place. In particular, it maintained a high risk country list which failed to include some high risk countries in which it did business but where it had local knowledge. Further, more than half of its deposits come from jurisdictions that have less stringent AML requirements and perceived higher levels of corruption than the UK. Hussain was responsible for overseeing Habib's AML systems and controls but failed to perform this role to an acceptable standard. Both parties settled early and were therefore entitled to 30% discounts on their fines.

For the related final notices, please see the relevant section of this update.



15 May: Solvency II and the London Market. The FSA has published a speech given by Julian Adams, Director of the FSA's Insurance Division, at the Insurance Day Summit. His speech focuses on the steps to be taken towards the implementation of Solvency II and the issues that have so far been faced. In accordance with the agreed timetable, firms will start to make submissions to the FSA this month to approve the models being adopted to implement the new regime. Formal applications will follow once the FSA has assumed its legal powers under Solvency II. Having given a recap of the timetable in place, Adams gives some feedback on issues and queries that have been raised during firms' preparation, highlighting those with specific relevance to the London Market. These include issues relating to methodology, scope of models, aggregation and dependency assumptions, the Use test, model change...

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