Executive Summary
2015 delivered the second-highest annual fine total in FCA history (approximately £905 million across 40 actions), driven by the continuation and conclusion of FX manipulation cases. The year culminated in November with Barclays Bank receiving the largest ever FCA fine at £284.4 million for FX benchmark manipulation.
Alongside wholesale market enforcement, 2015 saw significant retail conduct cases, including Lloyds Banking Group's £117 million fine for PPI complaint handling failures - demonstrating the FCA's breadth across both institutional and consumer-facing misconduct.
Regulatory Context
2015 represented the peak of the post-financial crisis wholesale market enforcement programme. The FX cases followed the LIBOR and EURIBOR manipulation cases of previous years, establishing clear expectations for benchmark and trading conduct across financial markets.
The FCA's approach to early settlement discounts remained critical to case resolution, with most major cases concluding through Stage 1 settlements (30% discount) rather than contested proceedings. This efficiency enabled the processing of multiple complex cases within resource constraints.
Preparation for the Senior Managers and Certification Regime intensified, with implementation scheduled for March 2016 for major banks. The regime promised to transform individual accountability by creating clear responsibility maps and evidential standards.
Key Enforcement Themes
- FX manipulation enforcement concludes at Barclays
- PPI complaint handling failures attract major fines
- Financial crime controls scrutinised
- Individual accountability increasingly emphasised
- Settlement efficiency enables case throughput
Professional Insight
The Barclays FX fine merits detailed analysis for its scale and scope. The bank failed for six years (2008-2014) to adequately control its FX operations, with traders sharing confidential client information and attempting to manipulate benchmark rates. The £284.4 million penalty reflected the seriousness and duration of the failings.
Critical to the case was evidence of cultural failures alongside control weaknesses. Traders operated in an environment where misconduct was normalised, with inadequate surveillance and challenge from compliance functions. The FCA's focus on 'tone from the top' and behavioural standards derived directly from such cases.
The Lloyds PPI case demonstrated that retail banking conduct remained a priority alongside wholesale enforcement. The £117 million fine addressed how the bank handled PPI complaints, finding systematic failures to investigate complaints properly and offer fair redress. Consumer outcomes matter as much as market integrity.
For compliance leaders, 2015 reinforced that major enforcement reflects accumulated failures over extended periods. Effective controls require sustained attention and investment, not episodic responses to regulatory attention.
Looking Ahead
2015 marked the end of the FX manipulation enforcement cycle, with subsequent years showing dramatically lower total fines as the pipeline cleared. The FCA's attention would shift towards AML and financial crime cases while also building capacity for new challenges.
The PPI enforcement signalled that retail conduct would remain a priority even as the redress scheme matured towards eventual conclusion.