The Financial Conduct Authority (FCA) has been told to get its house in order after admitting it doesn’t know whether staff with second jobs are getting paid for those roles.
The admission came in response to a Freedom of Information request filed by City A.M. asking for details on FCA employees with second jobs, which the regulator was questioned about back in 2022.
While the regulator did not disclose any data or information on the matter in response to the request, it did give a description of its record keeping on the issue.
The FCA said staff are required to seek approval for any outside position they hold, which could include “anything from volunteering for a charity organisation, being the director of a family business, school governorships or charity trustees”.
However, it added: “Whilst, given the restrictions set out in our policy, we expect the number of FCA employees holding second jobs to be small, based on the central records we hold, we are not able to identify which of the positions declared amount to a second job as colleagues are not asked to specify whether the position they declare refers to a paid second job.”
The admission raises questions about the watchdog’s record keeping on the issue, with campaign groups and political figures calling on the FCA to improve its procedures.
Reacting to the news, Labour MP Margaret Hodge, who is the chair of the all-party parliamentary group on Anti-Corruption and Responsible Tax, told City A.M. that it was important for the regulator to be transparent on this issue.
“We have to be able to trust our financial regulator to oversee the sector fairly and effectively. For that to happen, we need total transparency over its employees having second jobs,” Hodge said. “We must know for certain that no conflicts of interest exist which could bring the Financial Conduct Authority into disrepute.”
Dr Susan Hawley, executive director of campaign group Spotlight on Corruption, told City A.M. the FCA must urgently introduce an effective means of managing potential conflicts of interests to reassure both the public and financial services firms.
“For the FCA to say that it has no method of knowing whether or not its employees have external commitments that amount to a ‘second job’ is a huge cause for concern,” she said.
Rose Whiffen, a senior research officer at Transparency International UK, agreed that the regulator needed to put tougher checks in place.
“The FCA should collect data on paid roles in order to mitigate against conflicts of interest and ensure robust systems are in place to protect both employees and the reputation of the regulator,” Whiffen told City A.M.
The news comes after Reuters asked the FCA questions in September 2022 about Brian Corr, who is now Head of Market intervention, Retail Banking, and continues to operate a leadership, career and life coaching business.
The FCA said at the time that Corr had made the regulator aware of the coaching business and said he didn’t have any clients from regulated firms.
When asked for further details on staff with second jobs, the FCA said at the time it was unable to provide more information due to a systems change in 2021.
Corr did not respond to a request for comment, but the FCA confirmed to City A.M. that his outside work still presented no conflicts of interest.
A spokesperson for the FCA told City A.M. it has “robust procedures” in place to make sure any roles staff undertake outside of the regulator do not conflict with their work.
“Any member of staff seeking to take on a role that might present a conflict must seek written permission from a Head of Department or higher and then, where granted, must disclose this on a central register. Failure to comply with these policies may result in disciplinary action and ultimately dismissal,” they said.
The spokesperson added: “We do not judge that conflicts only arise where roles are paid for hence why we don’t require this information. It is the nature of the role itself which matters.”