On December 5, the UK Financial Services Authority (FSA) announced a consultation on its new regulatory framework for financial benchmarks – CP12/36 The Regulation and Supervision of Benchmarks. This follows on from the work of the Wheatley Review of the London Interbank Offered Rate (LIBOR) (as reported in the September 28, 2012, and October 19, 2012, editions of Corporate and Financial Weekly Digest).Continue Reading FSA Consults on Regulation of Benchmarks

On November 9, the UK Financial Services Authority (FSA) issued a paper entitled “Conflicts of interest between asset managers and their customers: Identifying and mitigating the risks” (the Paper). The Paper resulted from a thematic review of asset management firms conducted between June 2011 and February 2012 assessing their arrangements for managing conflicts of interest. The FSA stated that the thematic review was “prompted by evidence from our other supervisory work that some firms no longer saw conflicts of interest as a key source of potential detriment to their customers and had relaxed controls that we had considered to be well-established market norms.”Continue Reading FSA Requires Asset Managers to Address Conflicts of Interest

On November 14, the UK Financial Services Authority (FSA) announced that it had fined Savoy Investment Management Limited (Savoy) £412,000 (approximately $653,000) for failing to take reasonable care to ensure the suitability of the investment portfolios of its wealth management clients. Savoy was found to be in breach of Principle 3 (management and control), Principle 9 (customers: relationships of trust) and rules COBS 9.2.1 to 9.2.3 on suitability requirements.Continue Reading FSA Fines Manager for Systemic Suitability Failings

On October 31, the UK Financial Services Authority (FSA) published on its short selling webpage forms for notification of net short positions in UK issuers required to be disclosed to the FSA under the EU Short Selling Regulation (EU236/2012). The FSA had previously stated that it was developing a web-based solution notification of disclosable net

On November 1, the European Securities and Markets Authority (ESMA) published its opinion approving the three-month emergency short selling prohibition proposed by the Spanish regulator (the CNMV) under the EU Short Selling Regulation (EU236/2012) with effect from November 1. The Spanish ban is a continuation of the prohibition originally imposed by the CNMV on July 23, 2012, under Spanish law (as reported in the July 27, 2012, edition of Corporate and Financial Weekly Digest).Continue Reading ESMA Approves Spanish and Greek Short Sales Bans

On October 24, the UK Financial Services Authority (FSA) announced that it had fined two firms for failing to provide accurate and timely transaction reports. Plus500UK Limited (Plus500), an online contacts for difference (CFD) trading facility provider, was fined £205,128 (approximately $330,000) and James Sharp and Company (James Sharp), an independent stockbroker, was fined £49,000 (approximately $78,500).Continue Reading FSA Fines Two Firms for Transaction Reporting Failures

On October 17, HM Treasury published a written statement announcing that the Government “fully endorses” all of the recommendations of the Final Report of the Wheatley Review of LIBOR setting out recommendations for LIBOR reform (see the September 28, 2012, edition of Corporate and Financial Weekly Digest).Continue Reading UK Government Endorses All Recommendations of Wheatley LIBOR Review