FINES for bad behaviour could be 10 times larger and still have no impact on bank behaviour, top regulator Martin Wheatley said yesterday, arguing only personal punishment gets through to bosses.
The incoming head of the Financial Conduct Authority (FCA) fears fines are too easily passed through to shareholders, with directors untouched by the punishments.
Bank behaviour will only really improve if a new culture takes hold where banks really fear fines, and individual punishments could help further that.
“For banks with billions of pounds of profit, whatever the level of the fine they can just pass it to shareholders,” he said ahead of the FCA’s launch next month.
“Accountability to justice systems and to customers is what matters. We could put up fines to three times, five times, 10 times greater – it will not make a difference unless individuals are held to account.”
Tough new rules in areas like Libor could even see bankers jailed for fiddling the figures in future.
Wheatley added that a lack of competition in the sector has compounded the problem, by stopping customers from reacting to poor service or financial scandals.