The UK is rolling back key financial regulations introduced after the 2008 financial crisis, aiming to reduce accountability measures for City executives. The Bank of England and the Financial Conduct Authority (FCA) proposed changes that would scale back reporting requirements for lower-level misconduct and exempt around 140,000 managers from additional checks. The reforms, announced at a dinner for City executives, target the senior managers regime, which was expanded in the mid-2010s to cover all financial services firms, including banks, asset managers, and hedge funds.
The new rules would require only the most senior executives, such as chief executives and chief financial officers, to prove they are “fit and proper” each year and before taking new jobs. This shift means that about 140,000 staff will no longer need to demonstrate they are operating with “integrity” or adhering to conduct rules. The changes also loosen reporting requirements, with firms no longer obligated to report first warnings or minor misconduct, such as late arrivals or dropped calls, to regulators.
The regulators claim these adjustments will save businesses approximately £2 billion over 10 years while cutting the Bank of England’s and FCA’s costs by £11.5 million and £229 million annually, respectively. Despite the rollbacks, the Bank of England and FCA insist that high standards of individual accountability and conduct will remain unchanged, emphasizing their commitment to holding individuals accountable for misconduct that impacts society and employers.