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Regulator gets tough on financial SMEs

Published On 16 April 2007 at 08:57:55

A regulator which monitors the activity of firms working in the financial services sector has revealed that it plans to focus its attention on the UK's small and medium-sized enterprises (SMEs).

The Financial Services Authority (FSA) revealed that it would continue to maintain its tough stance on SMEs which failed to meet the minimum set standards in 2006/07.

If SMEs fail to meet these standards, which must be fulfilled in order for businesses to continue to be regulated, the FSA said that it would be forced to cancel these SMEs' permission to operate.

Figures published recently show that the FSA has already cancelled the permission for 151 SMEs.

"While our main emphasis is on helping firms to correct problems where possible, we take appropriate action when firms fail to comply with the conditions," explained Stephen Bland, the director of small firms at the FSA.

"Most small firms chose to fix any regulatory requirements that they were not fulfilling in order to stay in business.

"However, some decided to leave the regulated industry. In other cases we removed firms' permissions to carry out regulated business as they either could not or would not make the necessary changes to comply."

The FSA's figures also revealed that the majority of SMEs which had their permission cancelled in the last year had failed to submit their Retail Mediation Activities Return (RMAR).

 

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