FSA to launch investigation of bank bosses

FSA to launch investigation of bank bosses



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The Financial Services Authority will launch an investigation in the coming weeks into the behaviour of executives at bailed out banks RBS and HBOS, according to the Telegraph newspaper. 

The formal inquiry will focus on risk management processes, the conduct of directors in the run up to the Government rescue last year, and the amount of information made available to shareholders.
 
The controversial £703,000 a year pension of the former RBS chief executive, Sir Fred Goodwin, will not be covered in the investigation. It is also not believed that the FSA investigation will find any evidence of criminal wrongdoing by the bank executives and directors.
 
Accountancy firms Ernst & Young, Deloitte, KPMG and PricewaterhouseCoopers have been approached to assist with the investigation.
 
It is thought that the inquiry will form part of the City watchdog's new stricter style of regulation, following a warning to bankers by the FSA's chief executive, Hector Sants, who said in a speech earlier this year: "There is a view that people are not frightened of the FSA, I can assure you that this is a view I am determined to correct. People should be very frightened of the FSA."

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