REGULATION AND LEGISLATION
1. FINANCIAL SERVICES AND MARKETS ACT 2000.
2. FINANCIAL SERVICES AUTHORITY STATUTORY OBJECTIVES.
3. FINANCIAL SERVICES AUTHORITY HANDBOOK PRINCIPLES.
4. BULLYING AND INTIMIDATION IN THE WORK PLACE.
1. FINANCIAL SERVICES AND MARKETS ACT 2000.
The Financial Services Authority (FSA) is an independent non-governmental body, given statutory powers by the Financial Services and Markets Act 2000. The FSA is a company limited by guarantee and financed by the financial services industry. The Board sets the overall policy, but day-to-day decisions and management of the staff are the responsibility of the Executive Committee.
The FSA is accountable to Treasury Ministers and, through them, Parliament. The FSA is operationally independent of government and is funded entirely by the firms it regulates. The FSA claims to be an open and transparent organisation and provides full information for firms, consumers and others about its objectives, plans, policies and rules, including through its website .
The FSA has been the single regulator for financial services in the UK since December 2001, when it was given statutory powers by the Financial Services and Markets Act 2000 (FSMA).
The FSA has a wide range of rule-making, investigatory and enforcement powers to enable the agency to meet four statutory objectives.
The FSA currently regulate over 29,000 firms that have a diverse range of sizes and activities. The Agency publishes a single Handbook of rules and guidance for all authorised firms carrying out business in the UK.
In recent years, the government has increased the scope of its work: since November 2004 the FSA has been regulating mortgage business and since January 2005, general insurance activities. Since November 2009 the FSA has been regulating banks’ and building societies’ conduct of business, including payments services.
2. FINANCIAL SERVICES AUTHORITY STATUTORY OBJECTIVES.The Financial Services and Markets Act 2000 (FSMA) gives the agency four statutory objectives:
- Market confidence – maintaining confidence in the UK financial system;
- Financial stability – contributing to the protection and enhancement of stability of the UK financial system;
- Consumer protection – securing the appropriate degree of protection for consumers;
- The reduction of financial crime – reducing the extent to which it is possible for a regulated business to be used for a purpose connected with financial crime.
These are supported by a set of principles of good regulation (see below FSA Principles)- which the FSA must have regard to when discharging it’s functions.
The objectives also:
Provide political and public accountability – the provision of the annual report contains an assessment of the extent to which the agency has met these objectives. Scrutiny of the FSA by Parliamentary Committees may focus on how the FSA achieves it’s objectives.
Govern the way the FSA carries out general functions – e.g. rule-making, giving advice and guidance, and determining general policy and principles.
Assist in providing legal accountability – where the agency interprets the objectives wrongly, or fail to consider them, the FSA can be challenged in the courts by judicial review.
3. The FSA Principles; as described in the FSA Handbook.
PRINCIPLE 1-A firm must conduct its business with integrity.
PRINCIPLE 2-A firm must conduct its business with due skill, care and diligence.
PRINCIPLE 3-A firm must take reasonable care to organise and control its affairsResponsibly and effectively, with adequate risk management systems.
PRINCIPLE 4-A firm must maintain adequate financial resources.
PRINCIPLE 5.-A firm must observe proper standards of market conduct.
PRINCIPLE 6-A firm must pay due regard to the interests of its customers and treat them fairly.
PRINCIPLE 7-A firm must pay due regard to the information needs of its customers, andCommunicate information to them in a way which is clear, fair and not misleading.
PRINCIPLE 8-A firm must manage conflicts of interest fairly, both between itself and it’scustomers and between one customer and another.
PRINCIPLE 9-A firm must take reasonable care to ensure the suitability of its advice and discretionary decisions for any customer who is entitled to rely upon it’s judgment.
PRINCIPLE 10-A firm must arrange adequate protection for customers’ assets when it is responsible for them.
PRINCIPLE 11-A firm must deal with its regulators in an open and cooperative way, and must tell the FSA promptly anything relating to the firm of which the FSAwould reasonably expect prompt notice.
4. BULLYING AND INTIMIDATION IN THE WORKPLACE.
For bullying and intimidation in the workplace there may be an assortment of different legal principles involved, for example:
Breach of contract – usually breach of the implied term that an employer will provide reasonable support to employees to ensure that they can carry out their job without harassment and disruption by fellow workers.
Common Law right to take care of safety of workers.
Employment Rights Act 1996 (for example constructive unfair dismissal.
Personal injury protection involving the duty to take care of workers arising out of the law of Tort.
Health and Safety at Work Act Act 1974.
Trade Union and Labour Relations (Consolidation) Act 1992 (dealing with special types of intimidation etc).
Protection for whistle-blowers under the Public Interest Disclosure Act 1998.
Criminal Justice and Public Order Act 1994.
Public Order Act 1986.
Protection from Harassment Act 1997.
Human Rights Act 1998.
Ian Taplin September 2011