Enforcement: Changes to the PRA’s settlement policy - PS23/19
Overview
This Prudential Regulation Authority (PRA) Policy Statement (PS) provides the final Statement of Policy (SoP) ‘The PRA’s approach to enforcement: Statutory statements of policy and procedure’ (Appendix), as consulted in Consultation Paper (CP) 10/19 ‘Enforcement: Changes to the PRA’s settlement policy’ (see page 2 of 2).The PRA received no responses to the CP and has decided to make the changes to the SoP as consulted.
This PS is relevant to PRA-authorised persons, qualifying parent undertakings, persons who are or have been auditors or actuaries of a PRA-authorised person, senior managers and certified employees at firms, and all individuals involved in providing financial services to PRA-authorised persons.
In the CP the PRA proposed, by way of amendment to the SoP, to:
- simplify the PRA’s settlement discount scheme (by retaining a 30% penalty discount for early settlement and removing the 20% and 10% discounts available for settlement in later stages of an enforcement action); and
- clarify and make more transparent the PRA’s procedures for settlement.
The SoP takes effect from Friday 4 October 2019, with one exception: in relation to cases where the PRA has already concluded ‘Stage 1’ settlement discussions with the subject, without reaching a settlement, prior to Friday 4 October 2019, the existing scheme as set out in the March 2019 SoP ‘The PRA’s approach to enforcement: Statutory statements of policy and procedure’, will continue to apply.
Note: All content for this PS is included on this webpage. If you would like a PDF version of the PS, please use the ‘Convert to PDF’ button available below.
Enforcement: Changes to the PRA’s settlement policy - CP10/19
Overview
In this consultation paper (CP), the Prudential Regulation Authority (PRA) sets out proposals to amend its policy on the settlement of enforcement action. This is by way of proposed amendments to Statement of Policy ‘The Prudential Regulation Authority’s approach to enforcement: statutory statements of policy and procedure’ (‘the PRA’s Enforcement Statement of Policy’)
This CP may be relevant to PRA-authorised persons, qualifying parent undertakings, persons who are or have been auditors or actuaries of a PRA-authorised person, senior managers and certified employees at firms, and all individuals involved in providing financial services at PRA-authorised persons. It will also be of particular interest to professional advisers who represent firms and individuals subject to PRA enforcement action.
Background
In February 2017, the PRA and FCA published a joint Policy Statement ‘Implementation of the Enforcement Review and the Green Report’. This was in response to HM Treasury’s ‘Review of enforcement decision-making at the financial services regulators: final report’ (the ‘HMT Report’). The HMT Report made a number of recommendations, including regarding settlement policies and procedures (the ‘HMT recommendations’).
Implementation
The PRA will consider all representations received within the consultation period. Any changes to the settlement discount scheme will apply to all cases from the date of publication of the final policy, with one exception: in relation to cases where the PRA has already concluded ‘Stage 1’ settlement discussions with the subject, without reaching a settlement, prior to publication of the final policy, the existing scheme will continue to apply.
Responses and next steps
This consultation closed on Monday 15 July 2019. The PRA invites feedback on the proposals set out in this consultation. Please address any comments or enquiries to CP10_19@bankofengland.co.uk.
Update 10 May 2019: With thanks to those who registered their interest in the roundtable by the deadline of close of business today, we are reviewing responses and will be in touch to confirm attendance and further details by Friday 17 May 2019.
Consultation Paper 10/19