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Summary and Comments

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Category: 

Banking

Date: 

1998-03-21 00:18:58

Subject: 

British Regulator: We Will Shut Down Noncompliant Banks

  Link:

http://www.news.com/News/Item/0,4,20040,00.html

Comment: 

The agency in charge of British banking has threatened to shut down banks that are not gettng compliant, or at least keep them from taking on new business.

I would like to see how any agency can enforce this on, say, the Bank of England.

But it sounds tough. It sounds as if something, somewhere, might be done.

This is from C/NET (March 13).

* * * * * * *

The United Kingdom's Financial Services Authority, the country's chief financial regulatory body, has warned banks and investment houses that it will shut them down or block them from taking any new business if it feels they are not prepared to survive the Year 2000 problem.

At the Best Practice for Financial Institutions conference in England on Wednesday, the authority's managing director of financial supervision, Michael Foot, said it is not the job of the Financial Service Authority (FSA) to "solve other people's IT problems. It is our job to help protect investors from losses caused by inadequate preparation for the Year 2000. So in that sense preparing for the millennium is a regulatory issue."

The regulatory body, working with outside auditors, will look to firms for progress reports and plans, and decide whether they are pursuing a "credible, effective project," he said in a statement. . . .

If after looking at a firm's project, it seems investors, or markets, are at risk, Foot said his department will conduct an independent report. "But, if we are satisfied that stronger action is justified to achieve our regulatory objectives," the FSA will "restrict a firm's activity to take on new business, to stop doing business altogether, or transfer its business to another firm."

Foot's warning underscores the British government's commitment to deal with the Year 2000 problem, or "bomb" as it's called in that country. Observers have hailed the country's government as one of the more advanced in its efforts to deal with the issues within its own computer systems and push the private sector to do the same.

Link: 

http://www.news.com/News/Item/0,4,20040,00.html

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