FCA ON THE RACK

The chair of the Treasury Committee, Conservative MP Mr Mel Stride MP, has asked the FCA for an explanation for why the prosecution of Natwest took five years to come to a successful conclusion.  Good question!  

It was five years ago that the police launched a raid on gold dealer firm Fowler Oldfield that led eventually to the Natwest prosecution.  It might be understandable if the directors or employees of Natwest were shaking in their boots awaiting judgement– but they weren’t even prosecuted!  So the body-corporate scrambles about and recoups from customer deposit rates.

The time taken by the FCA seems to most IFA observers to be considerably faster than the pace the Endeavour Square Squad usually work at.  We’d congratulate them – and perhaps the elite committee is planning to reward them with further power to slow down financial services industry post Brexit. 

A simple mortgage application recently took the FCA one year before they even looked at the case, and as we are finding out, post covid the transfer of a share from one to another for a sole practitioner mortgage broker can take over six months before approval is granted.  If Mel Stride MP would like to send the FCA a bottle of champagne for moving so fast, we would be pleased to subscribe. 

Nikki Rathi is also facing scrutiny from the National Audit Office NAO.  For many years the FCA was immune to the challenge of the external auditor, but all that changed with the credit crunch, and since 2014 the chumocracy has been extended to include the FCA.  Their colleagues working in Buckingham Palace Road now drop by for tea once a year to see life in the East End for real.  

However, prodded by a politician’s stick, the NAO will this time be tasked with finding out one single question:  why the FCA have been sitting on their hands with the British Steel saga.  Good question!  This scandal was unfolding through 2017, and here in late 2021 we are really no further forward.  Firms that routinely used fake projection rates before transferring DB schemes to offshore advisers are still operating in the UK today (albeit not in pension transfer market) and none have been prosecuted, despite this being a criminal offence, and despite the FCA begin made aware of the fraud. 

The FCA will be aware that the investigators are not coming round for another six months – not until the Spring of 2022.  Catering facilities can easily be arranged before then for the NAO, to ensure the report on the industrial frauds carried out under their nose is TCF to the FCA in all respects.