Select committee: Treasury Committee
Conclusion 1
Fourth Report - The Financial Conduct Authority’s Regulation of London Capital & Finance plc
Published 24 Jun 2021
Paragraph 31
Addressed to HM Treasury
Treasury Committee The Financial Conduct Authority’s Regulation of London Capital & Finance plc All items in this report Report on parliament.uk ↗ Inquiry on parliament.uk ↗
Conclusion (the committee's words)
It is not immediately clear that Mr Bailey’s concerns about the distinction between “responsibility” and “culpability” in Dame Elizabeth’s draft report would have “compelled” him to make his “free-standing” objection. However we accept that it is likely that his strong concerns over the “responsibility” vs “culpability” point may have led him to make his “free-standing” objection to the inclusion of named responsible individuals, and that in the absence of his concerns about the distinction between “responsibility” and “culpability” he might not have put forward his “free- standing” objection. We cannot of course be certain about this and if we were satisfied that there was strong and clear evidence that Mr Bailey had misled the Committee on this point, it would be a serious matter. But the evidence does not support that particular conclusion, and we do not believe that Mr Bailey misled the Committee. We note that the revisions made by Dame Elizabeth to the draft report, clarifying that an identification of responsibility was not an attribution of culpability, met the essence of Mr Bailey’s request, and we believe that it is in the wider interest to regard this issue as closed.
From: Treasury Committee, Fourth Report - The Financial Conduct Authority’s Regulation of London Capital & Finance plc (HC 149), paragraph 31, 24 June 2021
Government response
The government responded to the whole report on 13 September 2021 (deadline 24 August 2021).
Summary written by Accountability Index from the government's response. It is not the government's own words.HM Treasury's response says the Government has "fully considered" the Committee's recommendations, agrees with some, and does not consider a formal FCA power to recommend perimeter changes "necessary".
- On the regulatory perimeter, the Government "considers that the existing arrangements for examining and, where relevant, amending the regulatory perimeter are effective", and does not consider it "necessary" to give the FCA a formal power to recommend changes.
- On mini-bonds, the Treasury "is aiming to publish its response to the consultation and bring forward plans for legislation in the autumn", rather than by the end of September 2021 as the Committee recommended.
- On fraud, the Home Office is developing a Fraud Action Plan, to be published "after the 2021 Spending Review", which "will consider any potential legislative or regulatory change required".
- On Financial Promotion Order exemptions, the Treasury "has already commenced work with the FCA to review exemptions" for high net worth individuals and sophisticated investors.