Where am I? 
Home Better Business Regulation
The Financial Services Authority’s (FSA) report into the failure of HBOS is being delayed by a legal challenge from Peter Cummings, a former senior executive at the bank.
The FSA has been investigating the failure of the bank for three years but will not publish its report until at least next year because Cummings is fighting in court to extricate himself, the Daily Mail reports.
Cummings was responsible for HBOS' loans book, which, due to extensive losses during the credit crisis, led to the bank needing its rescue takeover by Lloyds in 2008.
He is now fighting with the regulator to prove the whole HBOS board had responsibility for the loans.
Andrew Tyrie, chairman of the Treasury Select Committee, picutred, said the legal battle is prolonging the FSA's enforcement investigation into the culpability of the HBOS directors, further delaying the publication of a report.
In December, the FSA published a report on the collapse of the Royal Bank of Scotland (RBS).
In it, the regulator said its poor supervision of banks before 2008 was partly because of its preoccupation with reforms such as the retail distribution review (RDR).
The report called for closer supervision of banks and tighter regulation.
| Share | |
| Comment | FSA’s HBOS report held up by banker’s legal battle |
More regulation news
Email alerts
Recommended reading
Categories
Topics
Comments
Related articles
Most Read
Audio / Visual
With the industry's biggest fund managers, IFAonline welcomes you to the media centre.
This year we have 14 awards designed to mark out the very best products in a highly competitive and innovative market. This includes three new awards for 2011 to reflect the developments in this rapidly growing market: Best Dual/Multi-Index Product, Best Structured (Oeic) Fund and Best Structured Product Provider.
Events
Poll
|
|
Job search
Ifaonlinejobs will open the right investment career path for you. Search hundreds of vacancies on www.ifaonlinejobs.co.uk now
In Focus
Two months left before the ‘real RDR deadline’ – are you compliant with the required professional...
Viewpoints
2012 marks a watershed for the Life companies, fund managers, banks and advisers who service...
sponsored by
FSA's report on HBOS
To a certain extent Peter Cummings is right - the entire Board of HBOS was aware of the extraordinary loans the bank was making. I refer to a previous article in March last year about the dossier of letters proving the Board of HBOS was fully aware of a billion pound fraud in the bank which they chose to ignore - and worse still they spent hundreds of thousands trying to cover up. However, whether Mr Cummings is right or wrong, it doesn't diminish his own responsibility. Neither is it right that the FSA reports are continually hindered by legal action instigated by those responsible for the downfall of the now state owned banks and paid for with the handsome rewards the public was forced to pay those same people. There is another and more sinister complication and reason for delay I suspect. Until Operation Hornet is finished there is a risk the FSA will (as usual) try to minimise the factual detail about the demise of HBOS. But they risk the real truth being exposed by Thames Valley Police at a later date. I guess they will hedge their bets by letting the police do their job first because their (the FSA's) primary concern will be how much damage any HBOS report will do to the reputation of the FSA. While there are over 50 letters establishing what the Board of HBOS knew about criminal activity in the bank, there are many many more which establish what and how long the FSA have known about the basket case bank. And that information, like the information about the high fliers in HBOS, cannot be hidden. Same goes for what Gordon Brown and his pals at Lloyds knew about HBOS when they did their 'exceptional' deal.
Posted by: Nikki Turner