Information on enforcement investigations opened against individuals (SMR) - May 2022

Senior Insurance Managers Regime 

By way of background, the Senior Insurance Managers Regime was an interim regime in place between 6 March 2016 and 10 December 2018 (which was the date on which the Senior Manager & Certification Regime ‘SM&CR’ became effective for SM&CR insurance firms). The figures provided below take into account investigations under this regime as applicable.  

Senior Managers & Certification Regime 

• The Senior Managers and Certification Regime (SM&CR) has applied to Senior Manager Functions (SMFs) at UK banks, building societies, credit unions, branches of foreign banks operating in the UK and the largest investment firms regulated by the PRA and the FCA since 7 March 2016; 
• SMFs at dual-regulated insurers (regulated by both the FCA and PRA) have been subject to the SM&CR since 10 December 2018; 
• The SM&CR replaced the Approved Persons Regime (APER) for SMFs from 9 December 2019 for solo-regulated firms regulated by the FCA only; and 
• For banking firms, the FCA Code of Conduct (COCON) was extended to non-SMF staff from 07 March 2017. For insurance firms, COCON was extended to apply to non-SMF staff from 09 December 2019. It was extended from 31 March 2021 for solo regulated firms. The COCON rules apply to those staff that fall under the SM&CR. 

Any potential misconduct by individuals at firms prior to the dates listed above when the new regimes became effective is captured under APER. 

Please find the total number of opened/closed SM&CR investigations below. 

*Includes Certified Individuals, Material Risk Takers, and other staff to whom COCON applies. 

Please find below the number of SM&CR investigations which ended with regulatory action being taken. 

**Where the FCA obtains written agreement from the firm or individual that they will do (or refrain from doing) a particular thing. 

***Includes cases where there was insufficient evidence of a breach or where alternative action was taken, such as Supervisory action. 

In respect of the above information: 

• Further details of the investigation ended in 2018, in which the FCA imposed a financial penalty on 1 individual, can be found here[1]. 
• In 2019, the FCA issued a decision notice, setting out its decision to impose a financial penalty and prohibition on an individual, Mr Forsyth. That decision notice was referred to the Upper Tribunal. On 06 July 2021, the Upper Tribunal found that the FCA had not made out its case that Mr Forsyth failed to act with integrity. Following that, no further action was taken by the FCA. This investigation is included in the above table as one of the cases ended in 2021 which resulted in no further formal enforcement action being taken. Details of this case can be found here[2] and here[3].
• Further details of the investigation ended in 2021, in which the FCA issued a final notice against 1 individual can be found here[4].

Please find below a breakdown of SM&CR investigations by the Senior Manager Function held. 

Please note that individuals can hold more than one Senior Manager Function.  

Since we provided our response to your previous request (FOI7699), we have undertaken a re-assessment of our data, which would account for any difference in the figures.  

For the period you have specified, in addition to the 1 investigation opened in 2017 which ended in regulatory action, referred to in FOI7699, there have been 2 other investigations which have resulted in regulatory action. Of these: 

• one investigation opened in 2016 has resulted in a financial penalty/public censure; and
• one investigation opened in 2016 has resulted in an undertaking.

As explained above, an undertaking is where the FCA obtains written agreement from the firm or individual that they will do (or refrain from doing) a particular thing. 

Under the SM&CR, 5 enforcement investigations were opened into non-financial misconduct. Of these investigations, 2 are closed and 3 are ongoing. These investigations were opened in 2016, 2019, 2020, 2021 and 2022 respectively.  

In addition to COCON investigations under the SM&CR, during the same time period, the FCA has opened 10 Threshold Conditions investigations into non-financial misconduct - please see below for details.  

*This date has been taken as the starting point because this is the date on which SM&CR became effective, as stated in the summary provided above. 

**As noted above, since we provided our response to your previous request (FOI7699) we have undertaken a re-assessment of our data. This response reflects our most up to date understanding of our data in relation to these time periods.   

***This is the end date for the data provided in this response. 

Of the Threshold Conditions investigations (outlined above), please find below details of the 5 investigations which have resulted in regulatory action being taken. Please note that these investigations were opened in the period 28 September 2018 – 28 September 2019:   

• https://www.fca.org.uk/publication/final-notices/russell-david-jameson-2020.pdf[5] 
• https://www.fca.org.uk/publication/final-notices/mark-horsey-2020.pdf[6] 
• https://www.fca.org.uk/publication/final-notices/frank-cochran-2020.pdf[7] 
• https://www.fca.org.uk/publication/final-notices/jon-frensham-formerly-known-jonathan-james-hunt-2021.pdf[8] 
• https://register.fca.org.uk/s/individual?id=003b000000LUdoyAAD[9]