The Parliamentary Commission on Banking Standards had made a recommendation to replace the Approved Person’s Vetting Regime with a Senior Person’s Regime which would include regular monitoring of the most senior bankers. In place of a one-off judgement of suitability on appointment, regulators would require on-going monitoring and executives would be held accountable for failure to meet their specified responsibilities.
Soon after this recommendation, figures were published by law firm Pinsent Mason from a freedom of information request to the FSA, which revealed that scrutiny of senior appointments by regulators has waned over the last year, with the FSA vetting just 4% of applicants for boardroom-level roles at financial organisations last year, less than half of the amount that they vetted at the peak of the financial crisis.
With the Commission having noted gaps in the current process for senior bankers, it is likely that the regulators will take note and HireRight anticipates a change to the Approved Person’s Regime in the future.
In line with the Commission’s recommendations, HireRight advocate enhanced background screening for senior appointments at the time of hire, with annual rescreening for the duration of tenure, as best practice to meet compliance obligations and deliver comprehensive risk mitigation.
Read full details of the Banking Commission’s report on changing banking for good. http://www.parliament.uk/business/committees/committees-a-z/joint-select/professional-standards-in-the-banking-industry/news/changing-banking-for-good-report/