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Ex-HBOS chief lambasts ‘out of control’ FSA

by Daniel Grote on Dec 17, 2012 at 07:36

Ex-HBOS chief lambasts ‘out of control’ FSA

Former HBOS director Peter Cummings has lambasted the Financial Services Authority (FSA) over its handling of his fine and ban from financial services.

Cummings, former chief executive of HBOS corporate, was fined £500,000 in September and banned from financial services for his part in the bank’s collapse.

In an interview with a sub-committee of the Parliamentary Commission on Banking Standards, Cummings labelled the regulator as ‘out of control’ and said it was ‘unfair and sinister’ that he had been the only bank director singled out for regulatory action following the banking crisis.

‘We are not the only failed bank. There are at least four or five of them, and I find it curious that I was singled out,’ he said. ‘I think it is sinister and curious.’

He added that his lawyers believed the FSA penalty was ‘unlawful’, and that the regulator had reduced the fine from £800,000 to £500,000 when confronted.

‘I do think it bewildering and bizarre that in the space of a meeting and two phone calls – because they did not want me to take it to judicial review – they reduced the fine to £500,000,’ he said.

‘Frankly, it was like living in an American soap opera. I find it bewildering, bizarre and downright impossible to believe this country has an organisation that is out of control to the extent that it is. I think it is unacceptable behaviour.’

9 comments so far. Why not have your say?


Dec 17, 2012 at 08:03

It is fine to moan now - this is the beast that you created by years and years of lobbying from the bank sector.

Now your Frankenstein is out of control and you've been fined £500K and been banned from working in the industry.

I have every sympathy with anyone singled out by the Regulator. But the fact is that as a profession IFAs are 'singled out' (not sure that works when I'm talking about thousands of people!) and we will be paying a lot more than £500K every year to keep a bunch of rear-view mirror regulators, not to mention the Money Advice Service, going on inflated salaries.

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Jenny N via mobile

Dec 17, 2012 at 08:35

Sants failed in his job to regulate the banks yet he gets a nice job with Barclays. He should never be allowed to work in this industry again. Does this also mean that Barclays will never be fined in the future and will be perfectly compliant. Let's wait and see.

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David robinson via mobile

Dec 17, 2012 at 08:55

I agree with the comment about Sants is a total sham, Peter Cummings not knowing why is has been fined is a joke, he was the head of an organisation that was lending money to people to fund property purchases when we where clearly in a bubble at 10 times the salary! not only this interest rates needed to increase in 2006\2007 not fall to reduce the housing market bubble, and he did not see this coming, massive exposure to a single market , most IFA even the bad ones understand downpaying debt and deleveraging also diversification !

The guy should be in jail not a fine! As should some other directors to include Dick Feuld .

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Dec 17, 2012 at 09:20

Jenny N hits the nail on the head. It's all very well castigating Cummings, but the point is that he HAS ben punished, albeit in a very unacceptable manner, because ultimately he was held to account.

But who holds the FSA to account? What chance of smug old Hector being held to account? Out of control is exactly right and nothing will change.

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David Hedge

Dec 17, 2012 at 10:41

Totally agree that:

1 Sants was a total failure at the FSA

2 The FSA is out of control (and a failure).

2 Sants should be banned fron Financial Services for life

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Dec 17, 2012 at 11:39

Unbelievable how differently this man sees things from the other side of the same fence! Pathetic.

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John Smyth 3

Dec 17, 2012 at 12:02

He deserves what he has been given and more but he should, like other greedy bankers and regulaters, be given some time in the cooler. What they did was gamble stupidly and recklessly with the public's money.

Like him though I think he should not have been singled out. There are hundreds like him and also sales directors and managers who should be heavily fined, banned and given time in the cooler. I wonder though whether he did not go to the right school or university, did not have the right religion, was not a masonic member or was not a member of the right golf club.

I did not know until last week that Callum McCarthy was a long time Barclays bank employee prior to his appointment at the FSA.

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Banged to Rights

Dec 17, 2012 at 15:42

Ay, maybe a degree of hypocrisy, perhaps he was not a member of rite ?

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Bob Donaldson

Dec 17, 2012 at 17:37

No one holds the FSA to account as they are unaccountable!

Even the TSC can't make any inroads with them, they have God and might on their side - for the time being!

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