FSA issued record fines in 2009

The City regulator has plans to raise fine levels

The City regulator handed down record fines of nearly £35m in 2009, and it plans to increase the total in the future.

The Financial Services Authority (FSA) levied 41 significant fines during the year, the largest being the £8m ordered from Swiss banking giant UBS.

The total amount is up from the £22.6m it demanded in 2008, which itself was a record annual amount.

It now wants to set a series of minimum fines for some offences.

Rising penalties

The fines in 2009 were levied as a result of a range of offences. Some involved failure by financial firms to guard against employee fraud, whereas others came because customers were not treated fairly.

The UBS fine - the third largest recorded by the FSA to date - came because the bank failed to stop employees making unauthorised transactions and failed to spot "several warning signs" that systems were not working.

"Our bigger fines, record number of bans and successful criminal prosecutions this year reflect our tougher, more intensive enforcement approach," said Margaret Cole, FSA director of enforcement.

"These outcomes have made people sit up and take notice and we expect to see a change in behaviour in the industry. We plan to keep this momentum in 2010 to ensure our enforcement actions continue to support our aim of credible deterrence."

Now the FSA wants to increase fine levels, claiming fines have not been high enough to deter wrongdoers. It is consulting on plans that would treble its penalties in some cases.

Firms could be fined 20% of turnover, with individuals liable to penalties of 40% of their salary and bonuses.

Individuals guilty of "market abuse" will be fined a minimum of £100,000.