Financial regulators issue fines worth £2.45bn for misconduct

Companies who are found guilty of financial misconduct are being served with more fines than ever before, with a 271 per cent increase in penalties over the last 24 months.

The news has been revealed by data from EY, which also shows that the last two years have seen fines amounting to £2.45 billion being issued to firms that have failed to comply with relevant legislation.

While the number of firms being penalised has risen, so too has the average penalty amount: it has increased by 291 per cent over the same period, from £10.8 million to £42.3 million.

Industry leaders say that the trend has been caused by the fact that regulators have been given more powers to tackle non-compliance, following the changes made in the sector as a result of the financial crisis.

Criminal prosecutions against companies and their employees are also going up.

Barclays was recently fined £72 million by the Financial Conduct Authority (FCA) due to its failure to conduct adequate checks on clients, while in May the bank was also given a £284 million fine for its role in the foreign exchange rigging scandal.

Among individual employees that have been imprisoned are Kweku Adoboli, the trader who lost $2.3 billion (£1.5bn) through unauthorised trading activities and was subsequently given seven years in prison in 2012, as well as trader Tom Hayes, who was sentenced to 14 years in prison for his involvement with the Libor rate-rigging scandal.