Policy Dialogue on Corporate
Governance in China
Regulatory Enforcement, the UK Experience
Daniel Thornton
Law Policy & International Co-operation
Enforcement Division
Financial Services Authority
Accountability of the FSA
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Statutory immunity
Board appointed by HM Treasury
Non executive directors
Statutory consultation on rules and
policy
• Practitioner and consumer panels
• Treasury Select Committee in
Parliament
• Complaints Commissioner
Decision making process for enforcement
cases
Staff decision to impose sanction
RDC decides whether to issue warning notice
Firm/individual makes representations to RDC
RDC decides whether to issue decision notice
Firm/individual may refer to Tribunal
Tribunal decision may be appealed to the courts on point of law
Division of responsibility with Exchanges
and other regulatory bodies
• 8 Recognised exchanges
• Commercial as well as regulatory functions
• Market abuse: FSA powers against any
person
• Exchanges' powers against members only
• Operating arrangements with Exchanges
• FSA is UK Listing Authority
• FSA Enforcement experience with
breaches of the Listing Rules
Other regulatory bodies
• DTI: directors disqualification
• FRRP: breach of Companies Act
accounting requirements
• SFO: investigate and prosecute
serious fraud
• Police
• Overseas regulators
Effective sanctions and incentives
• For regulated firms, obligation to cooperate and self-report
• Importance of co-operation in the
disciplinary process
• The role of publicity
• Settlement
END