Following the LIBOR scandal - which, let's remember, happened on the FSA's watch - the FSA has made a submission to the Parliamentary Commission on Banking arguing that they need more powers:
...the FSA suggests exercising an appointment power over bankers whose information helps to calculate Libor, by adding them to its "approved person" register.Really? They would have spotted that Bob Diamond was the kind of manager under whose direction a firm could have undertaken the rigging behaviour that happened with LIBOR? Is the FSA recruiting gypsy fortune tellers?
The agency would assess whether they were "fit and proper" people who had "honesty, integrity and reputation" before they took the role.
Let's read about their most recent successful public prosecution: Peter Cummings of HBOS:
However, the FSA has judged Cummings to be personally culpable in breaching Statement of Principle 6 of the FSA's Code of Practice for Approved Persons, by failing to exercise due skill, care and diligence in managing HBOS’s Corporate Division during this critical period.Oh look! Peter Cummings was an FSA-approved person. So they signed off on his role. Good job, guys. That "approved person" register is really working out for you.
I'm being a little sarcastic. Really, though, all the FSA can check with their approved person register is that you're not a convicted criminal, don't have significant financial problems in your past (e.g. CCJs, directorship bans etc) and haven't admitted to connections with companies and people that are known to be dodgy. It's far from a panacea. All this Parliamentary Commission on Banking submission is intended to do is mark the FSA's intended territory. It will have no practical improvement on the financial system. At all.
That's not the only change they're trying to make:
The watchdog has called for "exemplary sanctions" and "forceful punishment" of bankers who are caught breaching regulations to make them an example in an industry where investigating malpractice is difficult.So the known problems are with finding and proving malpractice, and the solution is to increase the punishment of malpractice? Sorry, chaps, I'm not seeing it.
[Incidentally, Telegraph subs, it's "LIBOR" not "Libor". LIBOR is an abbreviation for London Inter-Bank Offered Rate. "Libor" is not an English word. How's that English Literature BA working out for you?]