Britain’s dispute with Russia escalated with the expulsion of diplomats across multiple countries and the UK government considering restrictions on the City of London’s involvement in Russian debt finance. China responded to the imposition of tariffs on its goods by the United States with tariffs of its own on food imports, which had a negative impact on global stock markets. The scale of Facebook’s exploitation of user’s data lead to global calls for tougher standards for private companies mining personal information. In Ireland Derville Rowland of the Central Bank spoke about cultural assessments which the regulator was undertaking and the potential for an introduction of the UK’s senior management regime in the country. Below we set out the leading stories in finance and regulation for the last two weeks.


The Central Bank issued three consultation papers: Consultation Paper 117 on a New Methodology to Calculate Funding Levies payable by Moneylenders has a closing date of 17th May 2018; Consultation Paper 118 on a Review of the Consumer Protection Code for Licensed Moneylenders has a closing date of 27th June 2018; Consultation Paper 119 on amendments and consolidation to UCITS regulations has a closing date of 29th June 2018.

The Central Bank entered into a settlement agreement with MiFID firm BCWM plc, which included a €220,000 fine and reprimand, for breaches of the Client Asset Requirements 2007. The firm was found to have failed to designate the title of client asset accounts or to have obtained confirmation and acknowledgement letters from banks and custodians. The breaches occurred across a six-year period to 2015.

The Department of Finance published a discussion paper on virtual currencies and blockchain technologies, and established a working group to monitor cryptocurrency developments. The paper includes a summary of developments in other countries and identifies risks and opportunities for Ireland. Whilst warning consumers of the risks of investment in cryptocurrencies, Minister Paschal Donohoe recognised the transformative potential of blockchain technologies.


The European Central Bank published guides to assessments of licence applications for banks and fintech credit institutions, whilst the European Banking Authority published recommendations on outsourcing to cloud service providers. The European Commission issued a proposal for a cybersecurity competence network with a European Cybersecurity Research and Competence Centre. The European Commission also issued draft directives on the taxation of the digital economy, which proposed a 3% tax on digital services where the main value is created through user participation. The European Securities and Markets Authority adopted Product Intervention Measures for Binary Options and CFDs, which will limit the ability of MiFID firms to sell the products to retail clients.

   United Kingdom

In Brexit news the FCA, the PRA and the Bank of England issued confirmations that EU institutions operating in the UK under the current passporting regime would be able to do so during a potential transition period. The Irish Central Bank published advice to Irish insurance intermediaries to ensure continuation of insurance contracts after Brexit. The Irish Stock Exchange sale to Euronext was completed, the motivations including potential demand for post-Brexit offerings for companies seeking a listing within the EU. The award of the government contract for the production of British passports after Brexit to a Franco-Dutch company annoyed many in the UK and cast light on procurement regulations and their continued existence after Brexit.

The Financial Conduct Authority successfully prosecuted Capital Alternatives Limited, Renwick Haddow, Marcia Hargous and Robert McKendrick in relation to their involvement in the Africa Land investment scandal. The High Court ordered that the defendants pay a total of £16.9m for their parts in four unauthorised collective investment schemes. The schemes involved promotions for land and carbon emissions to the public involving false, misleading and deceptive statements.

The Financial Conduct Authority published its new rules on advice on pensions transfers, following its consultation process in 2017. Transfer advice will need to take account of a consumer’s individual circumstances and the formerly used transfer value analysis will be replaced by personalised analysis of the consumer’s options, with a comparison showing the value of benefits being given up. A further consultation paper has been published on additional changes proposed by the regulator.


Russia’s central bank is to create a ‘bad bank’ to ringfence $19bn of the toxic assets of three of Russia’s largest lenders. The assets of the three banks will be transferred to Trust, another failed lender. The new bank will receive a loan of Rbs 1.1trn from tax player funds. Since 2013, more than 300 banks in the country have been wound down. The government is reported to have spent over Rbs 2trn in funding the country’s failed banking system.

Barclays Bank agreed to pay the United States Department of Justice $2bn to settle claims of mis-selling residential mortgage backed securities before the financial crisis. Two former directors, Paul Menefee and John Carroll, also agreed to pay a combined $2m. Neither the bank nor the directors admitted wrong-doing. The bank had previously refused to settle the claims along with its rival institutions in 2016, where the DoJ were understood to be demanding $5bn to settle. The bank also completed its ringfencing exercise, moving 24m customer accounts and £250bn of assets into a new bank, separate from its investments business.

The International Association of Insurance Supervisors issued a draft issues paper on Climate Change Risks to the Insurance Sector, which looks at present and future impacts on the industry and potential supervisory responses. Insurance Europe published a template to help insurers to meet their GDPR obligations. The European Insurance and Occupational Pensions Authority issued details of its 2018 stress tests for insurers, which will involve 42 insurance groups; results are expected to be published in December.

Topics covered by Better Regulation include
  • BRRD
  • Banking Structural Reform
  • Basel
  • Benchmarks Regulation
  • Brexit
  • Capital Markets Union
  • Capital Requirements Legislation
  • Central Securities Depositories Regulation
  • Credit Rating Agencies Regulation
  • Deposit Guarantee Schemes Directive
  • Dodd-Frank
  • EMIR
  • GDPR
  • Solvency II
  • Insurance Distribution Directive
  • Interchange Fees Regulation
  • Market Abuse/Insider Dealing
  • Markets in Financial Instruments Legislation
  • Money Laundering Directives
  • Money Market Funds Regulation
  • Mortgage Credit Directive
  • Payment Services Directive
  • PRIIPs Regulation
  • Prospectus Directive
  • Ring-fencing
  • Securities Financing Transactions Regulation
  • Securitisation Regulation
  • Senior Insurance Managers Regime
  • Senior Managers Regime
  • Undertakings for Collective Investment in Transferable Securities Directive