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Britain’s financial regulator has said it will “fundamentally reshape” its plan to “name and shame” more of the companies it investigates after the proposals provoked a major backlash in the City of London.
Nikhil Rathi, chief executive of the Financial Conduct Authority, said it would present revised proposals “in the next week or so” before making a final decision early next year.
Speaking to a House of Lords committee on Wednesday, Rathi said: “This is not a case of us opening up the entire book of investigations — that was never our intention.”
The FCA chief admitted there were “things we could have done differently” when the proposals were introduced in February, such as giving the usual public notification beforehand, communicating them better and adjusting the plans themselves.
Rathi said the revised plan would include giving companies at least 10 days’ notice before disclosing they were being investigated, instead of only one day as initially proposed.
The regulator would also introduce a public interest test to guide its decision of when to publicly disclose the targets of its investigations, he said.
The FCA said it already had the power to name the companies it is investigating in exceptional circumstances, adding: “If we do this in two or three more cases of regulated firms a year, then we are not talking about a big change.”
There were also cases where the regulator wanted more freedom to announce that it was not investigating a company over a particular issue, Rathi said.
Members of the House of Lords financial services regulation committee called for the regulator to provide a full cost-benefit analysis of the changes — but Rathi said it would only provide more detail of the “potential benefits”.