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how to use fines for financial misconduct October 8, 2012

Posted by Bradley in : financial regulation , trackback

The UK plans to change the rules so that fines for financial misconduct benefit the armed forces through the Armed Forces Covenant:

The additional funding can be made available in 2012-13 due to amendments which will be brought forward to the Financial Services Bill later this year. The amendments will mean that, in future, regulatory fines revenue in excess of enforcement case costs for the year will go to the Exchequer.

And the monies involved include the Barclays Libor fine.

I can understand why the Treasury would think that fines should contribute to the general welfare rater than reducing licensing fees for the financial industry. I don’t see quite why the Treasury wants to link financial misconduct to supporting people who have served their country in this way. Do they think that the financial regulators will act more aggressively in enforcement to benefit veterans? Surely not. And linking help for the armed services to what must be a quantitatively unpredictable source of funds seems odd to me.

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