Citywire printed articles sponsored by:
View the article online at http://citywire.co.uk/new-model-adviser/article/a640039
FSA consults on new benchmark rules following Libor review
by William Robins on Dec 05, 2012 at 11:13
The Financial Services Authority (FSA) has proposed new rules and regulations for financial benchmarks following the recommendations of the Wheatley Review into Libor.
Libor has historically been set by the financial markets, and existed outside of any regulatory regime. The FSA said this industry-led approach had failed in the case of Libor.
In July chancellor George Osborne commissioned Martin Wheatley, managing director of the FSA and chief executive designate of the Financial Conduct Authority (FCA), to undertake a review of the structure and governance of Libor and the corresponding criminal sanctions regime.
The proposals included in the FSA's consultation include:
- requirements for benchmark administrators to corroborate submissions and monitor for any suspicious activity;
- requirements for those submitting data to benchmarks to have in place a clear conflicts of interest policy and appropriate systems and controls;
- introducing two new significant influence controlled functions created under the FSA’s approved persons regime for the administrator and submitting firms.
Wheatley (pictured) said: ‘Confidence and trust are critical to financial markets. The disturbing events uncovered in the manipulation of Libor have severely damaged that trust. Today’s proposals will bring in clear rules for the setting and governance of benchmarks and are a key step to ensuring the integrity of Libor.’
News sponsored by:
Today's top headlines
Challenged by growing risk aversion?
Challenging financial markets over recent years have resulted in growing risk aversion among British savers and led many to seek safety in cash. Click here for more.
More about this article:
More from us
- Osborne launches crackdown on ‘cowboy’ tax advisers
- Wheatley: mis-selling banks can learn from advisers’ client focus