5. The Regulators' Enforcement Process

Question 1

What three powers do enforcement officers have?

Answer 1

1. Enter premises of authorised firm with no notice
2. Demand documents, tapes, files and data
3. Interview any employee but they can only investigate approved employees.

Question 2

What are the supervisory and enforcements powers of the FCA/PRA?

Answer 2

1. Appoint a skilled person to report on any matter required
2. Appoint investigators for general investigations
3. Appoint investigators for a specific breach

Question 3

Describe the enforcement process step by step.

Answer 3

Investigation leads to preliminary findings.

1. If nothing is wrong, RDC will issue notice of discontinuance.
2. If something is wrong but not too serious and not warranting a disciplinary action, they will issue private warning. Kept on file and can be used against you in future in investigations.
3. If something is wrong and warrants further disciplinary action, the RDC will issue a warning notice which highlights notice before they issue disciplinary action

Supervisory notice leads to support instead of disciplinary

Firm will then respond

1. Can lead to decision notice equalling disciplinary

OR

2. Supervisory to provide help

Then can appeal to Upper Tribunal in 28 days.

RDC can then issue:

1. Final decision notice = disciplinary
2. final supervisory = help
3. notice of discontinuance = stopped investigation

Question 4

What are the three key features of the RDC?

Answer 4

1. Only chairman of RDC is an FCA employee
2. Appointed by and accountable to FCA board
3. Exercises certain decision-making powers on behalf of FCA/PRA.

Question 5

What is the EDMC?

Answer 5

Enforcement Decision-Making Committee.

Decision-making body for the PRA enforcement regime.

Question 6

Name some key features of the Upper Tribunal.

Answer 6

Independent to FCA/PRA

Part of Ministry of Justice

Question 7

Can FCA/PRA issue notices?

Answer 7

Yes they can.

Question 8

What 5 disciplinary measures can be taken?

Answer 8

1. Prohibition Order
2. Restitution
3. Public censure, statements of misconduct
4. Prosecution
5. Withdrawal, variation of authorisation or approval.

Question 9

When would Part 4a permission be withdrawn?

Answer 9

1. Non-compliance with regulations/regulatory bodies
2. Failure to maintain resource of capital
3. Non-payments of fees
4. Cease to operate

Question 10

When would Part 4a permission be varied?

Answer 10

1. Failing to meet Threshold Conditions.
2. Significantly breached PRIN 6 to 10