As the FCA cracks down on the wholesale markets following the forex manipulation scandal, thousands more financial traders will be monitored by the City watchdog and banks.
Regulators are currently deciding whether to execute plans that would tighten the regulations on 150,000 financiers in the commodities, currencies and fixed income markets.
The certification regime will affect 45,000, including the staff and traders who aided in setting the prices of important financial benchmarks, including Libor.
This extension is in addition to the 65,000 who are already covered by the regime. It will increase the coverage of the regulation to industries that were not touched by this degree of monitoring.
It will cover staff in companies such as hedge funds, brokerages and investment banks.
Although traders won’t need to be ‘pre-approved’ by the FCA, the banks will strictly monitor staff and reassess employees’ positions annually.
Extension long overdue
Andrew Tyrie, MP and chairman of the Treasury Select Committee believes the extension is long overdue.
Mr Tyrie said: “When Certification was first proposed by the Banking Commission, neither the Government, nor the regulators, seemed to take much interest in it,”
“It is disappointing that the banks had not already identified the risks that these individuals posed, given the appalling misconduct in the forex market.
“Banks should know already which of their staff can cause serious harm to the bank or its customers. If banks are doing their jobs properly, the certification regime will not therefore place a significant additional burden on them.”