Top bankers on the hook as UK conduct rules get personal
Starting Monday, UK regulators' efforts to crack down on misconduct in the City of London will get personal. The Senior Managers and Certification Regime is intended to make people working in financial services, from banks to payday lenders and investment firms, directly accountable for misconduct that occurs on their watch. Firms have to spell out to regulators the responsibilities of each senior manager along with a blueprint that shows how their areas intersect. Top employees must be pre-approved by regulators.
The rules are part of the government's response to the financial crisis, when authorities struggled to prosecute individuals who had led their firms into taxpayer-funded bailouts because their responsibilities weren't clearly defined.
"This gives some certainty and should result in more effective governance and monitoring of the way the firm manages its employees," said Michael Potts, managing partner of London law firm Byrne and Partners. "However, individuals identified as senior managers will be rightly alarmed by the rigidity in this framework."