The FSA confirmed that of those that who had their membership cancelled, most were due to non-returns of their Retail Mediation Activities Review (RMAR). Between April 2006 and March 2007, 98 firms failed to return their RMAR, compared to 107 the year before. In all, the number of firms who had their permissions cancelled fell by 10, from 161.
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Stephen Bland, director of small firms at the FSA, admitted that some firms could not, or would not make the necessary changes in order to comply with regulation. He said: “The action we take against firms who do not comply with our minimum standards and our tough stance on firms’ continued failure to submit the RMAR is working. Ensuring that firms implement and maintain these conditions is a priority for us.
“Most firms chose to fix any regulatory requirements that they were not fulfilling in order to stay in business. However, some decided to leave the regulated industry. In other cases we removed firms’ permissions to carry out regulated business.”
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A broker, who wished to remain anonymous, said: “The FSA has stepped up its enforcement action in the last year. The natural result is that small firms will be affected and there has been a definite move by the regulator to give more focused reviews on areas such as non-conforming.”
