Bonuses for UK regulators on ice pending report on collapsed fund


© Reuters. FILE PHOTO: The logo of the new Financial Conduct Authority is seen at the agency’s headquarters in the Canary Wharf business district of London

By Huw Jones

LONDON (Reuters) – Britain’s Financial Conduct Authority (FCA) said on Thursday it has deferred annual bonuses for top officials until a report on its handling of collapsed London Capital & Finance (LCF) investment fund has been issued.

LCF went into administration in early 2019 with 11,600 investors hit with losses totalling up to 237 million pounds.

The FCA was ordered by Britain’s finance ministry to carry out an independent investigation into the circumstances surrounding the demise of LCF.

Then FCA CEO Andrew Bailey left to become Governor of the Bank of England in March.

“This investigation is ongoing and, as a result, the Remuneration Committee has decided that performance bonuses awarded to voting members of the Executive Committee in respect of the year under review should be deferred until the report of the investigation has been issued,” the FCA said in its annual report published on Thursday.

“The Committee will then decide whether it is appropriate for the bonuses to be paid at all, in whole or in part.”

The investment fund was regulated by the FCA and sold unregulated “mini bonds”.

It collapsed after the FCA directed it to withdraw promotional material.

The FCA said it will change how it pays bonuses from the current 2020/21 financial year, paying them in two instalments, one up front, and the remaining 60% deferred until a year later.

READ  What is the US yield curve and why has it spooked investors?

“The Remuneration Committee may decide in its absolute discretion that the deferred amount should be reduced or not be paid at all as a result of circumstances arising or new information being available after the date of the award,” the FCA said.

“Bonus funding used to be up to 15% of our salary bill in 2015, this reduced to 12.6% for the 2019/20 review.”

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.





READ SOURCE

LEAVE A REPLY

Please enter your comment!
Please enter your name here