Integrity: when honesty is not enough

Integrity is a concept usually associated with honesty. An approved person might therefore expect his integrity to remain intact provided he refrains from any dishonest conduct. Recent decisions, however, have indicated an increasing tendency on the part of the FSA to treat negligence as an integrity issue, writes Katie Stephen of Norton Rose.

Katie Stephen (+44 (0)20 7444 2431, katie.stephen@nortonrose.com) is a dispute resolution lawyer at Norton Rose.

A recent, settled final notice for James Ian Shanks [1], saw a prohibition imposed on the mortgage broker for failing to act with integrity. The FSA found that Mr Shanks had not taken steps to verify information provided by mortgage applicants (who were employed by firms at which he was an approved person) and had thereby failed to prevent his firm from being used to perpetrate financial crime.