Tens of thousands of City workers would be affected by the party’s amendment to government legislation, which would impose a code of conduct on all employees who exercise controlled functions.
“We want this to have a cultural effect on bankers and introduce a presumption that people will be struck off for improper conduct,” a Labour source told City A.M., drawing parallels with the British Medical Council’s tough approach to health professionals who step out of line.
“Bankers would have the sword of Damocles hovering over their head – no one would want to risk being struck off,” they added.
Today’s proposed amendment to the Financial Services bill would apply to everyone who is currently part of the approved persons regime, meaning it would affect industries such as insurance that escaped the financial crash with their reputations largely intact.
Approved workers would be expected to maintain basic levels of integrity, hold appropriate professional qualifications, and commit to some form of continuous professional development.
Last night a Treasury source attacked the plan and accused Labour of undermining a cross-party committee that is already considering how to beef up the sanctions regime for bankers.
Other Labour amendments to the bill include immunity for whistleblowers who disclose bad behaviour in a bank, the establishment of a special financial crime unit within the Serious Fraud Office, and the publication of bank lending data by postcode to see which areas are ill-served by existing institutions.