Financial Conduct Authority chief hopes new senior managers regime would have prevented 2008 financial crisis

 
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The FCA's Andrew Bailey hopes the new senior managers regime would prevent another financial crisis (Source: Getty)

The chief executive of the Financial Conduct Authority hopes the new senior managers regime would have prevented the 2008 financial crisis.

Andrew Bailey described the previous system as "fuzzy", adding: "The Parliamentary commission on banking standards had this very nice analogy with Agatha Christie’s Murder on the Orient Express: ‘Everybody’s at the scene of the crime, nobody’s responsible for it.’”

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Asked, in an interview with ITV News at Ten, whether the current regime would have prevented the 2008 financial crisis, he said: “Well, I hope so because I hope that it would have contributed significantly to creating an environment where people say: ‘I won’t do the sorts of things that I did do, because I know much more clearly now what the consequences of those actions would be.’”

Under the new regime, senior managers in British banks, building societies or so-called systemically important investment firms will be held criminally liable for a range of offences. These include taking a decision which causes their institution to fail, being aware of the risk that a decision could lead to institutional failure or demonstrating conduct “far below that could be reasonably be expected of a senior manager in that position”.

Chancellor George Osborne has said the new rules show the government "has learnt from the lessons of the past".

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