Financial watchdogs should increase penalties to discourage frauds: Cole suggests
Financial watchdogs should increase penalties to force business to take the law seriously, Financial Services Authority's top official Margaret Cole said.
Ms. Cole, who is preparing to leave for the private sector, has transformed the FSA from an enforcement division into an aggressive criminal prosecutor over the last seven years of her tenure.
Speaking on the topic, she said, "Whether you then apply a multiplier, or do a step change, or approach this in a different way... we're in a moving world where we expect penalties to be higher and you've got to take it jolly seriously."
She stressed that misbehaviors must not be allowed slip between regulatory gaps during the time when the FSA breaks up and a new economic crime agency is organized.
She further said that fines or penalties must not be a cost of doing business.
The biggest penalty imposed by the FSA to date was a £33 million hit to JP Morgan Chase in 2010, while the US' record for a civil securities breach is $550 million hit to Goldman Sachs.