Information on enforcement investigations into senior managers

Reference Case Number: FOI8689

Freedom of Information: Right to know request:

As at the date of the FCA's response to this request, how many enforcement investigations does the FCA have open into:

1. Individuals who hold Senior Management Functions. Please also provide a breakdown of this number to show which Senior Management Functions are held by individuals under investigation. Please also provide a general description of the nature of these investigations (e.g. lack of fitness/propriety or culture/governance).

2. How many investigations commenced against individuals who hold Senior Management Functions have been discontinued in the past 12 months.

3. Individuals who fall within the Certification Regime. Please provide a general description of the nature of these investigations.

4. Individuals for breaches of the COCON rules who are not senior managers or covered by the certification regime.

5. Individuals who fall within the approved persons regime.

FCA response:

In considering the information, please note the following:

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.
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. Overall, the FCA has over 370 individuals under investigation for a range of potential breaches, including but not limited to APER, COCON, Fitness and Propriety (FIT), and criminal misconduct.

As of 27 April 2022, 81,305 individuals hold Senior Manager Functions.

1. Individuals who hold Senior Management Functions. Please also provide a breakdown of this number to show which Senior Management Functions are held by individuals under investigation. Please also provide a general description of the nature of these investigations (e.g. lack of fitness/propriety or culture/governance).

As at 27/04/2022, the number of current open SMCR investigations (Senior Manager Function) is 47. Of these, Senior Managers under investigation held the following senior manager functions (please note that individuals can hold more than one Senior Manager function):

SMF1 – 9

SMF2 - 1

SMF3 – 22

SMF8 - 3

SMF16 – 4

SMF17 – 3

SMF18 - 1

SMF19 - 2

SMF21 – 2

SMF24 - 1

SMF27 - 5

SMF29 – 3

The general nature of these investigations varies. The issues under consideration in these investigations include, but are not limited to: lack of fitness & proprietary, governance & control, fraud, investment scams, market manipulation, money-laundering controls, culture and governance, advice/pensions, conflict of interest, non-financial misconduct, systems and controls.

2. How many investigations commenced against individuals who hold Senior Management Functions have been discontinued in the past 12 months.

In the past 12 months (up to 27/04/2022), three investigations into individuals who hold a Senior Manager function have closed without taking further formal enforcement action. This includes cases where there was insufficient evidence of a breach or where alternative action, for example Supervisory action, was taken.

3. Individuals who fall within the Certification Regime. Please provide a general description of the nature of these investigations.

As at 27/04/2022, the number of current open SMCR investigations (non-SMF individuals) is 16. Non-SMF includes Certified individuals, Material Risk Takers, and other staff to whom COCON applies.

The general nature of these investigations varies. The issues under consideration in these investigations include, but are not limited to: advice – non-pensions and pensions related, Bribery and corruption controls, Culture and Governance, Individual competence, integrity and reputation, Insider Dealing, Market Manipulation, Systems and Controls and Payments.

4. Individuals for breaches of the COCON rules who are not senior managers or covered by the certification regime.

Of the 16 non-SMF individuals under investigation for breaches of COCON, we do not record MI that splits this category out further.

5. Individuals who fall within the approved persons regime.

There are 108 open investigations into individuals who fall within APER (approved persons regime) as at 27/04/2022.

Date of Release: 27/05/2022

Information on enforcement investigations into senior managers - May 2022

Freedom of Information: Right to know request:

FCA response:

2. How many investigations commenced against individuals who hold Senior Management Functions have been discontinued in the past 12 months.

3. Individuals who fall within the Certification Regime. Please provide a general description of the nature of these investigations.

4. Individuals for breaches of the COCON rules who are not senior managers or covered by the certification regime.

5. Individuals who fall within the approved persons regime.

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