The Financial Conduct Authority’s (FCA) intentions to delete its emails after 12 months “is very much at odds with what it expects the industry to do”, lawyers have warned.
The City watchdog has told staff that it would start automatically deleting emails that remained in their inbox for more than 12 months unless considered important enough, as reported by the Financial Times.
The report noted a notice on the regulator’s intranet page that states the new policy “reduces the legal and reputational risk we face”, starting on 1 April.
Charlotte Hill, partner at Charles Russell Speechlys told City AM that the FCA’s plan to delete its own emails “is very much at odds with what it expects the industry to do”. She went on to add “Imagine if a bank announced” this.
She explained the watchdog’s “strict rules on record keeping requirements for the firms it regulates, with at least five years for investment companies, three years for others and indefinitely for pension transfer firms”.
Harvey Knight, partner at Withers said “It appears to be one rule for the regulator and another for the regulated.”
He went on to say that “it only seems fair and to make sense if the FCA also propose to amend their own Handbook and remove the requirement on each regulated firm having to arrange for orderly records to be kept of its business and internal organisation.”
Hill pointed out that when a scandal comes to light in the future, “where no action was taken by the FCA despite many emails from individuals and industry participants, this will be hidden.”
“The FCA will be able to say, quite truthfully, that it has no record of anyone ever having raised the point – a destruction of evidence,” she stated.
However, she added that not everyone will be upset by this new policy, as “any individual who has had an FCA investigation into their conduct is likely to welcome the chance of all records about them being destroyed.”
This comes after the FCA was at the centre of a data protection scandal in 2023 over a policy of “intercepting and diverting” emails of its staff to keep track of people “considered a nuisance”.