The Financial Conduct Authority (FCA) has paid out over £125 million in bonuses to staff since 2016, despite being accused of systemic failures following a series of financial scandals. The Observer obtained details of the payouts, which include bonuses of up to £45,000 each for executive directors.
Campaigners have described the bonuses as an “absolute insult” to savers who lost their life savings due to the regulator’s failings. Gina Miller, co-founder of the True and Fair Campaign, said the FCA had “failed from top to bottom” and that awarding bonuses against a backdrop of major scandals was “unbelievable”.
The FCA has faced criticism over its handling of the collapse of London Capital & Finance (LCF), which saw 11,600 investors lose up to £237 million. A report by Dame Elizabeth Gloster found the regulator failed to supervise LCF effectively. The FCA was also criticised for its role in the collapse of the Connaught Income Fund and the Woodford Equity Income Fund.
FCA chief executive Nikhil Rathi has proposed scrapping the bonus system, stating that payouts had “not been effective at driving individual or collective performance”. In a consultation document, he said it was “increasingly difficult” to justify bonuses after independent reviews found the regulator acted too slowly to protect consumers.
The FCA confirmed that executive directors declined performance bonuses for 2020-21 and will not be eligible for future awards. The consultation on pay and benefits runs until 20 December.
