FCA and PRA to investigate HBOS Senior Managers

These investigations will determine whether or not any prohibition proceedings should be commenced against them. The FCA and PRA continue to review materials with a view to making further decisions regarding other former HBOS senior managers.

In November, a review into the failure of HBOS concluded that "ultimate responsibility for the failure of HBOS rests with the Board and senior management".

The report argues that they failed to set an appropriate strategy for the firm’s business and failed to challenge a flawed business model which placed inappropriate reliance on continuous growth without due regard to risks involved.

Andrew Green QC's independent assessment of the FSA's investigation into HBOS also found that the FSA's initial decision-making process was "materially flawed".

Green recommended that the PRA and FCA should now consider whether any former senior managers of HBOS should be the subject of an enforcement investigation with a view to prohibition proceedings.

No financial penalty can be imposed as the statutory time limit for starting disciplinary proceedings against individuals has expired.

More to follow...