FSA powers to include “plea bargaining” for whistle-blowers

by Gill Montia

Story link: FSA powers to include “plea bargaining” for whistle-blowers

The Chancellor of the Exchequer, Alistair Darling, is considering extending the powers of the Financial Services Authority to allow it to plea bargain with City whistle-blowers.

The move comes days after market rumours wiped 20% of HBOS shares in the space of one hour.

The incident led to speculation that the rumours emanated from traders manipulating the market to make profits by short-selling

The FSA has launched an enquiry but there is a strong possibility that the culprits will never be identified.

In an interview with The Guardian newspaper, Mr Darling said: “I can’t allow us to get into a situation where people quite deliberately manipulate markets for personal gain with the potential to destablise the financial system.”

New legislation is expected to be outlined in the coming months and the plea bargaining powers proposed for the FSA are likely to be similar to those already granted to the Serious Fraud Office.