More than 50% of Fines Issued by the FSA are as a Result of Weak Risk Management Systems

Research from the Chartered Institute of Internal Auditors has revealed that more than half of the fines handed out by the Financial Services Authority (FSA) in 2011 were as a result of weak internal risk management systems. 

Fines can be issued by the FSA when organisations breach any of the eleven principles (operational and ethical). The recent research announced by the Chartered Institute of Internal Auditors, shows that 60% of the FSA’s fines in 2011 were as a result of weak risk management systems – in 2010, 55% of fines were levied as a result of this.

Dr Ian Peters, Chief Executive of the Chartered Institute of Internal Auditors says:

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FSA fines Barclays £7.7 million

The Financial Services Authority (FSA) has fined Barclays Bank plc (Barclays) £7.7 million for failures in relation to the sale of two funds. In addition to the fine, it has been estimated that this operational failure could cost Barclays up to £60 million in compensation, £17 million of which has already been paid out to customers.

This fine is the largest imposed by the Financial Services Authority for a case involving retail investors and the sixth largest in the regulator’s history.

Read the full story on FT.com

Read Barclays statement

Read the FSA press release in full