FSA has published its plans for a consistent and more transparent framework for calculating financial penalties. It plans:
- to link fines more closely to firms' income (basing the fine on up to 20% income from the business area linked to the breach over the relevant period and up to 40% of an individual's salary from their job relating to the breach);
- to impose a minimum fine of £100,000 on individuals in market abuse cases; and
- to take into account for the total fine factors such as removing any profits, seriousness of the breach, aggravating or mitigating factors, deterrent effect and settlement discount.
The paper gives examples of how the proposals will work and FSA's plan to apply the same principles to its non-FSMA enforcement actions (for example, for breaches of MLR and PSR). It includes draft amendments to DEPP, EG and the RCB sourcebook. FSA wants comments by 21 October and wants to apply its new policy to breaches committed after February 2010.