FSA wages rise to facilitate 'greater supervision'

Wednesday 9th March 2011

Figures released by the Financial Services Authority (FSA) reveal that the average salaries of its employees has risen 22 per cent over the past five years. 

Since 2005/06 the average staff salary now stands at £51,232. The figures do not include data for the current fiscal year, but for the year that ended in March 2010 they were up 6 per cent from 2009.Senior management wages have risen 14 per cent since 2005/06, from £206,391 to £236,950 in 2009/10.Ray Cohen, Managing Director of Jackson Cohen, said: “I think they need more intrusive supervision to make sure more firms comply with the regulations although I think that banks and building societies are under a lot more supervision then previously.”The increase has been perceived as a move to enhance the quality and quantity of its supervisors and enforcers. The data does not include directors’ salaries.Ray Cohen said: “The enforcement division have taken on a lot of extra staff which is quite reasonable. They’ve earned their money and the fines will be used to reduce the fees, but perhaps the quality of the staff is not strong enough.”The enforcement division saw the largest jumps in salary, with average salaries up 26 per cent from 2005 to £53,207.Ray Cohen further commented: “The number of staff able to deal with complex authorisation applications isn’t enough, so I think they need to recruit more people of a high standard to deal with it.”The FSA decided to increase its workforce, in particular the number of staff assigned to supervision and risk, following the collapse of Northern Rock in 2007. There are currently 1,158 people employed within the supervision department and 391 in enforcement.The operations division, which includes IT and support, salaries rose a modest 3.5 per cent over the same period, which average £34,702.FSA chief executive Hector Sants told the Financial Times: “These figures reflect our tougher approach both to enforcement and supervision, which we have underpinned by bringing in more experienced people. It also reflects our success in controlling costs in the non-regulatory areas of the business.”
The overall salary bill at the FSA also increased due to an influx of new recruits. There were 300 recruits in 2006/07 and 500 in the last fiscal year.


Manchester debt firm is liquidated owing creditors over £2.2m
Wednesday 11th August 2010

Bankrupt football legend probed by police over loan fraud
Monday 2nd August 2010

Mortgage broker ordered to repay £1.5m of client money used to pay off debts
Wednesday 14th July 2010

Barclays lifts lid on banking write-offs
Wednesday 20th February 2008

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Consumer credit licence fees set to increase

Wednesday 2nd March 2011

The OFT announced this week that it will be increasing the cost of its overall fees for all applications, so as to ensure that a greater level of scrutiny is given to each case.

It is the OFT’s responsibility to assess all licence applications and decide whether the applicant is competent for the applied role, which could be debt counselling or other positions which are deemed ‘high-risk’ to the consumer, including sub-prime lending.

This increased ‘scrutiny’ means that the applicant could be subject to site visits, staff interviews and compliance reviews.

Ray Watson, OFT Director of Consumer Credit, said:”We strive at all times to minimise costs for regulated businesses but we must fulfil our statutory duty to protect consumers in their dealings with credit businesses. This increase will allow us to do so.”

In real terms, this increase will result in a sole trader paying £435 for a five year credit licence application, up £21 per year from previously. For all other applications from non sole traders, the price is £1,075, up a sharp £51 per year.

 Yet despite the affect that the fee increase will have on the debt management sector, many industry professionals are applauding the OFT’s action and hoping that it will act as a barrier to entry from applicants who are unfit for the position and who reflect badly upon the reputation of the private debt management industry. 

Manchester debt firm is liquidated owing creditors over £2.2m
Wednesday 11th August 2010

Bankrupt football legend probed by police over loan fraud
Monday 2nd August 2010

Mortgage broker ordered to repay £1.5m of client money used to pay off debts
Wednesday 14th July 2010

Barclays lifts lid on banking write-offs
Wednesday 20th February 2008

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Bankrupt footballer has £2.2M debt slashed

A former football star is set to repay just a fraction of his debts totalling a staggering £2.2 million.

The former Blackburn Rovers and Scotland defender, Colin Hendry, will avoid the repayments of more than 98 per cent of his debts.

Hendry, 45, who developed a gambling problem following the tragic death of his wife Denise almost two years ago, could repay just £36,000 of his debts after agreeing a deal that would take into consideration a number of properties which would clear at least part of the sum.

The rest of the repayments will depend on how much he earns over the coming years as a TV football pundit on ESPN.

Aged 42, Denise Hendry died in 2009 from a meningitis-like infection, following complications to correct a botched liposuction operation seven years’ previous.

Earlier last year, dad-of-four Hendry came clean during an interview with the BBC in which he admitted to drinking heavily and gambling to cope with the grief.

But now, despite being made bankrupt with £2.2 million debts, the Daily Record reports that the accountant overseeing his bankruptcy has written to his creditors informing them he will pay back just £1,000 per month over three years.

Hector McFarlane, a former friend who claims he loaned £95,000 to Hendry, told the Scottish paper: "I am just flabbergasted. I stand to get back £1,800 of the money I loaned him. It's an absolute disgrace." 

Mr McFarlane continued: "His lifestyle's hardly changed. He lives one of the best lifestyles of people I know. I gather he gets more than £1,000 a game as a TV pundit."

Hendry’s biggest creditor however is HM Revenue & Customs, who he said to owe £1.3 million. He is also reported to owe £65,000 to his late dad's estate, £35,000 to his brother and £10,000 to Denise's parents.

Howard Walker, son of the late Blackburn chairman Jack Walker, was also listed as a creditor, as was online betting firm SpreadEx.

Debt Management Today reported back in September that Hendry had sold his luxury home in Lytham, Lancs for £1.7 million but after paying off mortgages and loans there is said to be no cash left.

Hendry now rents a home in an exclusive development in Lytham, where his neighbours include several current English premier league stars – despite being restricted to £500 rent allowance by his bankruptcy trustee.

Hendry started his career with Dundee before spells at Manchester City, Rangers, Coventry City and Bolton Wanderers, and was capped 51 times for Scotland and captained them during Euro ’96. He has also tried his hand at management with Blackpool and Clyde.

The bankruptcy will cease automatically after three years unless the trustee applies to the court for an extension.

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CAB cold-calling complaint threatens legitimate firms

Wednesday 9th March 2011

An investigation has been launched by the Office of Fair Trading (OFT), after a major complaint over cold-calling was lodged by the Citizens Advice Bureau (CAB).

CAB claim to have received an increase in the number of complaints reported by consumers, who were persuaded to hand over their bank account details to illegitimate ‘debt management’ firms as a direct result of cold calls. The OFT said that cold calling by such firms was an ‘emerging unfair business practice’, and that the ‘practice of illegal or misleading cold calling for debt management services must cease immediately’. However the advisors at debt management firms which do follow the OFT’s guidelines, have expressed concern that the CAB’s super-complaint could lead to vulnerable individuals being less likely to approach debt solutions firms, who could potentially lessen their financial woes.Neil Conrad, a regional advisor at Eurodebt Financial Services, said: “I think the super complaint by the CAB, who seem to want the OFT to blanket ban cold calling & up-front fees, is in danger of tarring all companies with the same brush, and could prevent people being contacted by companies such as EuroDebt, who can provide them with genuine help.”Beverley Budsworth, Managing Director of The Business Debt Advisor, added: “The OFT guidelines on debt management do not permit cold calling by personal visit. If people have opted in or ticked a box that says they want further help, then this is permissible.“I do hope that the OFT takes a practical approach and stamps out sharp practice but leaves intact compliant debt management companies who genuinely care about improving people’s awareness of the excellent rescue culture we have in this country.”The OFT’s investigation is currently on-going, but the OFT is expected to publish a response to the Bureau’s complaint within the next 90 days.
Manchester debt firm is liquidated owing creditors over £2.2m
Wednesday 11th August 2010

Bankrupt football legend probed by police over loan fraud
Monday 2nd August 2010

Mortgage broker ordered to repay £1.5m of client money used to pay off debts
Wednesday 14th July 2010

Barclays lifts lid on banking write-offs
Wednesday 20th February 2008

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England footballer 'fleeced' by agent

Wednesday 9th March 2011

An England and Aston Villa footballer has become embroiled in a row with his former agent, claiming hundreds of thousands of pounds have gone missing from one of his bank accounts. 

Midfielder Stewart Downing, 26, appeared at York Crown Court on Monday accusing his former agent of fraud, having discovered just £11,000 in a bank account that he believed contained nearer to three quarters of a million pounds.The former Middlesbrough and Sunderland player told a jury how Ian Elliot, 53, used the cash to save his own failing businesses, ‘siphoning’ an account which should have contained between £600,000 and £700,000.According to the Mirror, Downing confirmed an account had in excess of £2 million going through it, although £136,000 had left the account to pay for a variety of luxury items.As well as the home cinema, he spent £30,000 on a home extension, £6,000 on a walk-in wardrobe and £45,000 on a conservatory. Other expenditure included £6,000 on a bathroom. He also gave his family £180,000 over a number of years, the jury was told.According to the Mirror, Downing told the court: "I discovered a lot of money missing...I relied on him to do most things on the business side.” He told the court he never read his contracts while Elliott was in charge of his affairs.The BBC reported back in September 2008 that Mr Elliot was being questioned by police after alarm bells started ringing and Downing grew concerned at how his ‘company affairs’ were being handled.It is also alleged Elliott acted as the agent for Middlesbrough while also acting for Downing during contract negotiations, something described in court as a "conflict of interest" and against Football Association rules.Downing denied the claim that he was trying to increase his wages at Middlesbrough to £80,000 a week during contract negotiations in 2008.He said the figure of £80,000 was "comical" and he would never try to get that much money from Middlesbrough.Mr Patton said: "You expressed the view you were the best player at the club and thought you were entitled to parity with the highest-paid player, who was in fact paid £80,000 a week."Downing said Middlesbrough chairman Steve Gibson would never pay that kind of money. He said: "Even when I went to Aston Villa I never ever demanded £80,000 a week.”He told the jury he thought he was one of the best players at the club and his new contract should reflect that.The Northern Echo reported that Robin Patton, defending, accounted for some of the missing money by detailing a number of items bought using the account in question. Mr Elliot is said to have helped Downing buy a string of high-performance cars, including Aston Martins, Bentleys and Ferraris, and arranged improvements to his property. Other items include exotic holidays for his parents, a £43,000 conservatory and a BMW X5 for his sister.The Northern Echo reports that the pair’s relationship ended on bad terms in 2008, when Mr Elliott was interviewed by former referee Jeff Winter on a North-East radio station. During the interview, Mr Elliott said Downing had expressed a desire to leave Middlesbrough, a claim Downing denies.Downing, who signed for Aston Villa for £10 million in 2009, has earned 25 caps for England since making his debut in 2005.Mr Elliott, from Whickham, Tyne and Wear, denies all the charges.
Manchester debt firm is liquidated owing creditors over £2.2m
Wednesday 11th August 2010

Bankrupt football legend probed by police over loan fraud
Monday 2nd August 2010

Mortgage broker ordered to repay £1.5m of client money used to pay off debts
Wednesday 14th July 2010

Barclays lifts lid on banking write-offs
Wednesday 20th February 2008

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Latest debt statistics offer a glimmer of hope

Wednesday 9th March 2011

The latest crop of numbers from Credit Action, released last week, show that there has been an overall drop in debt problems in the UK since the same time period in 2010. 

The striking statistics show that big steps have been taken in the tackling of debt in the past 12 months, however, most still provide food for thought.For example, the total number of purchases made using cards daily stands at a whopping £1,153,000,000, while someone is declared insolvent or bankrupt at least every five minutes.According to their latest monthly release, the number of people made redundant each day remains high, despite being down from 1,732 to 1,589, and 833,000 people were shown to have been unemployed for more than 12 months.Joanna Parsley, of Credit Action, said: “Monthly debt stats are a great tool for getting an overall picture of the state of play in the UK, when it comes to all things debt and money related. March’s stats show that compared with this time last year there are less people going through insolvency. In 2010 every 3.7 minutes someone went through insolvency. We now know that the rate has slowed to every 4.28 minutes which is good news for consumers.”The Citizens Advice Bureau (CAB) now deal with deal with 8,004 new debt problems each day, a decrease from the 9,500 that was reported this time last year.Young adults, from the age of 20-29 are the most likely to be in the red with 46 percent of this age group unable to stay in the plus. They are also the group most likely to remain in their overdraft, with 16 percent unable to get out of it.Joanna continued: “We also know that compared to this time last year total levels of personal debt have dropped – total household debt was £58,040 and it’s now £57,635. A fall of £405 is a significant drop and indicates that consumers have been trying to pay down their debts over the past year especially when interest rates are at historic lows.”Banks and building societies write off £24.88 million of loans daily and every 17 minutes a property is repossessed in this country.“Looking ahead this year looks to be difficult for many consumers. With high inflation and the cost of living rising - energy, petrol and food prices all on the up - consumers will continue to see their budgets squeezed. This coupled with unemployment fears and many changes to tax and benefits that will take place in April will see almost all household budgets change.“It’s so important that we look to budget our finances and review this regularly to ensure we’re on top of our money and in control of our spending. “Getting on top of our finances now and seeking free and independent help if needs be is a priority to ensure that consumers are not weighed down by the burden of over-indebtedness.”337 people every day of the year will be declared insolvent or bankrupt. This is equivalent to one person every 59 seconds during a working day.
Manchester debt firm is liquidated owing creditors over £2.2m
Wednesday 11th August 2010

Bankrupt football legend probed by police over loan fraud
Monday 2nd August 2010

Mortgage broker ordered to repay £1.5m of client money used to pay off debts
Wednesday 14th July 2010

Barclays lifts lid on banking write-offs
Wednesday 20th February 2008

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Senior HSBC banker uses ATM in 'professional' scam

Wednesday 2nd March 2011

A former bank manager who pocketed £60,000 in a 'professional' scam faces jail.
The former HSBC employee diverted funds into holding accounts before withdrawing the cash at ATMs.

The Basildon Recorder reported that Kevin Bishop, 49, of Dorset Way, Billericay, fiddled the figures at HSBC branches in Hackney, Stoke Newington and Walthamstow, which he managed between May 2002 and August 2009.

Prosecutor Arizuna Asante told Snaresbrook Crown Court: “The fraud has the hallmarks of professional planning.

“It does require someone at his level of authority to work through the intricacies of impersonal accounts and subsequently effectively hide those entries from the auditors over that prolonged period of time.”

Bishop has admitted the fraud, but claims he acted under the orders of three “mystery men” who threatened him with a knife. Mr Asante said Bishop claimed after his arrest that the unidentified men had ordered him to carry out the crime.

He had been due to be sentenced on Saturday but now faces a “trial of issue” on March 11, whereby Judge John Hand will decide which version of events is true, unaided by a jury.

Judge Hand warned Bishop: “I am not inclined to accept this mitigation unless I am convinced by hearing evidence on it.”

Bishop claims he had to hand over all the cash to them and has been left in debt. The court heard HSBC will recoup its losses by stripping Bishop of his hefty pension.
Bishop admitted fraud by abuse of a position of trust.

Manchester debt firm is liquidated owing creditors over £2.2m
Wednesday 11th August 2010

Bankrupt football legend probed by police over loan fraud
Monday 2nd August 2010

Mortgage broker ordered to repay £1.5m of client money used to pay off debts
Wednesday 14th July 2010

Barclays lifts lid on banking write-offs
Wednesday 20th February 2008

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