On March 17, the UK Financial Services Authority (FSA) published its Business Plan for 2010-2011. The document sets out the FSA’s priorities for the coming year. The FSA characterized the Plan as “a demanding programme of work for the year requiring greater policy and supervisory resources.” Its key areas of focus are:

  • Delivering effective supervision, backed by the use of its enforcement powers, as a means to achieve credible deterrence
  • Making the cultural and organizational changes to the FSA needed to implement intensive supervision
  • Taking forward the policy reform agenda of the FSA’s Turner Review and the wider policy agenda mandated by the European Union
  • Fulfilling its role in promoting financial stability under the new Financial Services Bill—if that Bill is passed by the UK Parliament

In developing intensive supervision, the FSA’s regulatory approach has moved to a more proactive stance. Supervisors are now making judgements on firms’ business models and intervening earlier than was previously the case if they anticipate any risks that may arise from regulated firms’ conduct, sales practices, senior management competence or product development.

The FSA considers that credible deterrence underpins its supervisory approach and emphasizes the number of criminal prosecutions for insider dealing prosecutions, and proceedings against a number of other individuals for insider dealing and making false or misleading statements to the market. (See the February 19 and March 12 editions of Corporate and Financial Weekly Digest).

To read the Plan in full, click here.