The financial services sector is to be subject to further scrutiny, following the Government’s announcement of a review into the way wholesale financial markets operate. 

The review, which will be a joint operation by the Treasury, the Bank of England and the Financial Conduct Authority (FCA), aims to raise standards of conduct in the financial system.

It follows a number of serious allegations of misconduct in financial markets, and will focus on those wholesale markets where the bulk of concerns about misconduct have arisen – fixed income, currency and commodity markets – although it could have applicability across a wider range of wholesale markets.

The Government says that the review will build upon the tough action Britain has already taken to punish the wrongdoers and fix the financial system, including the work of the FCA to reform LIBOR, and the Parliamentary Commission on Banking Standards, which has led to a new legal regime for senior managers.

The Review will run for 12 months and is expected to make recommendations on:

• principles to govern the operation of fair and effective financial markets,
• reforms to ensure standards of behaviour are in accordance with those principles,
• tools to strengthen the oversight of market conduct,
• whether the regulatory perimeter for wholesale financial markets should be extended, and to what extent international action is required, and
• additional reforms in relation to benchmarks, in order to strengthen market infrastructure.

Contains public sector information licensed under the Open Government Licence v2.0.

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