UK FCA conducts seven dawn raids in 2016 – RPC data

Maria Nikolova

The small number is seen as a result of the winding down of FCA’s clampdown on financial crisis era crime.

The UK Financial Conduct Authority (FCA) carried out humble seven dawn raids of business and individual’s premises in 2016, according to data published earlier today by law firm RPC.

Dawn raids are searches under warrant and in the presence of a police officer. Their name reflects the fact that they are often conducted in the early hours of the morning in order to get a maximum amount of evidence. The raids are often accompanied by arrests.

RPC says that the number of dawn raids conducted by the UK regulator last year marks an 81% drop from the 37 dawn raids that were carried in 2009 when the financial crisis was at its height. In fact, the law firm explains that the small number of raids that took place in 2016 reflects the gradual winding down of the regulatory clampdown on financial crisis era crime.

The publication of the latest numbers follows earlier research by RPC which has shown that the amount of FCA fines fell from £905 million in 2015 to meager £22 million in 2016.

Earlier this year, there were calls for changing UK laws, as estimates by the New City Agenda think-tank have shown that UK banks and financial services firms benefited from a total discount of £1.2 billion on FCA financial penalties between 2013 and 2017. Companies subject to enforcement action by the FCA can get discounts of up to 30% on their fines if they settle the case.

During the 2013-2017 period, the FCA imposed a total of 82 financial penalties. Out of these, on 66 occasions firms received a 30% discount, on 8 occasions firms benefited from a 20% discount and on 8 occasions firms got no discount. Excluding the discounts, the fines would have reached £4.2 billion, the think-tank estimates.

In late April, however, the proposed “Amendment 13” which sought to deprive financial companies of discounts to FCA fines until they complete internal disciplinary actions agreed with the regulator, was withdrawn amid opposition from Baroness Williams of Trafford, Minister of State at the Home Office, and a Conservative member of the House of Lords.

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