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Located within growing scholarly interest in linking the global financial crisis with revelations of financial crime, this piece utilises Roman Tomasic's suggestion that the financial crisis has marked something of a turning point in regulatory responses to financial crime worldwide. Tomasic attributes this to changing attitudes towards light-touch regulation and risk assessment, and the demand for existing agencies to be replaced with new tougher authorities. In the UK, this can be illustrated by the imminent replacement of the FSA with the Financial Conduct Authority (FCA). The paper aims to discuss these issues.

Discussion of the FSA's financial crime fighting activity is an important forecast for the likely directional focus of the FCA in this regard. A focus only on “market abuse” enforcement within this arises on account of the effects for financial systems widely attributed to this activity, with threats to systemic stability being a hallmark of the 2007-2008 financial crisis. This methodology also encourages coherence in focus and management of sources within the article. Market abuse enforcement provides a lens for exploring the FSA's adoption of the philosophy and ethos of “credible deterrence”, and FCA commitment to retain it, and ultimately for applying the hypothesis of the “haphazard pursuit of financial crime” to pre-crisis criminal enforcement relating to financial crime undertaken by the FSA.

The FSA and FCA appear acutely aware that the financial crisis has marked something of a turning point for the enforcement of financial crime, and for signalling changes in approach, for the reasons explored by Tomasic. Tomasic correctly identifies factors encouraging a range of undesirable practices pre-crisis, and ones signalling tougher and more sustained attention being paid to financial crime henceforth. It is noted that, pre-crisis, the FSA's pursuit of criminal enforcement of market abuse was conscious, comprehensively resourced, well publicised, and actually extensive.

This exploration of the FSA's criminal enforcement of market abuse given the Authority's own perceptions that it was not, and could never be, a “mainstream” criminal prosecutor considers the likely lasting legacy of this determined pursuit, when domestic politics and pan-European policies suggested against this. This is likely to be enormously valuable as the FCA undertakes this task in a domestic arena which is markedly in contrast from this, and where European agendas are pushing in favour of criminal enforcement, with the “more Europe, or less” debate providing a further dimension of interest.

The purpose of this paper is to highlight the activities of the FCA with respect to the incidence of money laundering and highlight regulatory gaps. The financial services sector provides a crucial infrastructure for the promotion of wealth and innovation in the UK. This attractive infrastructure also appeals to criminals looking to launder the gains of their illicit activities.

The paper analyses the UK money laundering regime, highlighting specific challenging areas. The paper investigates the role of politically exposed persons and the use of corporate structures in promoting money laundering. In this context, it also becomes crucial to investigate the role of financial institutions and the sufficiency of their governance approach in lessening the incidence of money laundering. The paper investigates secondary sources and relies on their findings. It compares these findings to the regulatory outcomes.

The paper recommends steps that can be used to lessen the incidence of money laundering in the UK. From the reports evaluated, it is clear that the Financial Conduct Authority is working towards reducing the incidence of money laundering, but this could be further strengthened with the adoption of additional enforcement tools.

The paper suggests that different approaches should be used based on firm size, the type of business and the risk that a financial services firm presents to the financial sector. A large firm will need to bear more regulatory burden compared to a smaller firm.

The paper investigates the current approach to minimising the incidence of money laundering in the UK. It suggests that the regulator can guide financial services firms to meet the regulatory objectives by relying on an approach that discerns the regulatory risks presented by different firms depending on their size.

This paper aims to explain the importance of the international cooperation and coordination among supervisory authorities of different countries in event of banking crises. It also suggests that the harmonious relationship has to be attained in the adoption of ex ante financial regulatory measures and ex post compensation schemes. In other words, the paper highlights the linkage between ex ante preventive regulatory measures and ex post compensation schemes, on the one hand, and cooperation among national regulatory and supervisory authorities in globalized financial markets. Although the paper is relevant to most developed and emerging financial markets, it chooses Hong Kong as a context to examine this proposal. In the current literature, there are no similar approach linking these two paradigms and examining them in an integrated context.

The paper adopts a conceptual framework after the 2008 global financial crisis and takes Hong Kong, an international financial centre in which numerous branches or subsidiaries of foreign financial institutions locate, as an example to examine how the coordination with foreign supervisory authorities are being conducted and to analyse whether the present regulatory framework in Hong Kong is effective and sufficient against banking crises. Through the review of the literature, the important link between ex ante regulatory measures and ex post compensation schemes is found to be significant in adopting proper solutions.

Through analysing the Hong Kong financial regulators’ reports on the collapse of Lehman Brother, the paper finds out that even though there is some weakness in the cooperation and coordination between regulators after the 2008 financial crisis, Hong Kong is still in the progress of proposing bank special resolution regime. Although there has been some awareness on the issue of coordination between home and host states regulatory measures, there is still a lack of awareness of the connection between regulatory measures and compensation schemes.

Conflict of interests could hardly be prevented in the course of cooperation and coordination among home and host regulatory authorities, and the coordination of the important link between ex ante regulatory measures and ex post compensation scheme which involves legal and economic analyses is a challenging task.

The paper’s findings show that there are practical implications for the recent rapid development of special resolution regime for global systematically important financial institutions against future banking crises and for managing the balance between the adoption of financial supervisory laws and special resolution measures.

This paper suggests that the harmonious coordination between ex ante regulatory measures and ex post compensation schemes has to be achieved through international context to avoid the absurd situations. This conceptual integrated framework presented in the current paper is not touched upon by the existing literature. This important concept is valuable for future research, and it is significant to financial regulators, legislators and the government in adjusting policy against banking crises in both developed and developing countries.

This paper aims to examine three important interrelated issues that arise in the context of financial investigations: the access of law enforcement agencies to centralised bank account registries that have been set up in several jurisdictions; the exchange of financial information between financial intelligence units (FIUs) that function in different jurisdictions; and the exchange of financial information between FIUs and law enforcement bodies. Through the adoption of Directive 2019/1153, the European Union (EU) has attempted to achieve a paradigm shift in these three areas, but many challenges remain, from the interconnection of registries to the implementation of adequate data protection safeguards.

This paper draws on primary sources of law, legal scholarship, reports and open source data to analyse the changes that Directive 2019/1153 has brought about in conducting financial investigations in the area of anti-money laundering (AML) and the counter-financing of terrorism (CFT).

The new Directive 2019/1153 constitutes an international model for broadening the access of law enforcement agencies to financial information and facilitating information exchanges between FIUs and law enforcement agencies. Nevertheless, many challenges have still to be addressed, such as the interconnection of centralised registries and the implementation of adequate safeguards.

This is a comprehensive study examining the new EU framework for access to financial information and information exchanges between FIUs and law enforcement agencies, which can be used as a model for international cooperation in the areas of AML/CFT.

This paper aims to explore the underlying problem of tackling money laundering, namely, the difficulty of enforcing international laws and whether this is a problem which is too great to overcome in practice.

A doctrinal approach is used to discuss international anti-money laundering (AML) laws and question whether money laundering can be truly regarded as an international crime. A comparative approach with case studies of corruption in financial institutions illustrates the problems which law enforcement might encounter. The advantages and disadvantages of tackling money laundering will be highlighted to elucidate both the negative impacts of the crime and the reasons why some states may not be tackling money laundering as forcefully as they could.

Uniformity of AML laws among different countries may deter criminals from laundering money. The ratification of the Vienna Convention can help to facilitate uniformity of legal rules. States need robust domestic laws to tackle money laundering. Money laundering is an international crime, although not always a specific crime in international law. Moreover, it is generally advantageous to consider money laundering to be a specific crime under international law.

The article questions the effectiveness of current AML laws by examining the foundations of international law. Suggestions as to how uniformity can be achieved are given. A comparative approach is also used to demonstrate the extent of the crime, weaknesses in companies’ regulatory regimes and how each State responds to money laundering. The comparison also reveals State-specific issues which fuel money laundering. Moreover, the article explores the practical and legal advantages and disadvantages of money laundering being considered a specific crime in international law.

The purpose of this paper is to examine the effectiveness of UK investment firms’ implementation of the requirements in Commission Delegated Regulation 2017/589 (more commonly known as “Regulatory Technical Standard 6” or “RTS 6”) that govern the conduct of algorithmic trading activities.

A qualitative examination of 19 semi-structured interviews with practitioners working for, or with, UK investment firms engaged in algorithmic trading activities.

The paper finds that practitioners generally have a good understanding of the requirements in RTS 6. Some lack knowledge of algorithms, coding and algorithmic strategies but have used best efforts to implement RTS 6. However, regulatory fatigue, complacency, cost pressures, governance in international groups, overreliance on external knowledge and generous risk parameter calibration threaten to undermine these efforts.

The study’s findings are limited to the participants’ insights. Some areas of the RTS 6 regime attracted little comment from participants.

The paper proposes the introduction of mandatory algorithmic trading qualification requirements for key staff; the lessening of the requirements in RTS 6 for automated executors; and the introduction of a recognised software vendor regime to reduce duplication and improve coordination between market participants that deploy algorithmic trading systems.

To the best of the author’s knowledge, the study represents the first qualitative examination of firms’ implementation of the algorithmic trading regime in the second Markets in Financial Instruments Directive 2014/65/EU.

Emphasizing that errors are unacceptable and will be sanctioned does not prevent that errors are made – but can cause workers to cover up mistakes. Making an effort to identify things that go wrong to learn from them and prevent errors in the future offers a more fruitful approach. By sharing an applicable LEARN framework, this paper aims to inspire and give direction to financial corporations in building an error management culture within their organizations.

The behavior and culture team of the Dutch Authority for the Financial Markets (AFM) collaborated closely with social and organizational psychologists from Utrecht University to study error management. The results of a literature study were combined with the findings obtained from a survey (N = 436) and in-depth interviews (N = 15) among employees of 13 Dutch financial corporations that are active within the infrastructure of the capital markets.

Tone at the top and direct managers’ behavior were positively related to error management culture, which in turn related to more learning. Combining these findings with relevant psychological literature resulted in the LEARN framework, which can guide organizations in developing actions and interventions to build an effective error management culture: Let the board take ownership, Engage employees, Align structure and culture, Refocus from person to system and Narrate the best examples.

Stimulating financial corporations to start building a healthier corporate culture by offering the LEARN framework – and recruiting insights from social and organizational psychology to do so – extends traditional supervisory approaches.

The purpose of this paper is to examine the effectiveness of two regulatory initiatives in developing awareness of conduct risk associated with algorithmic and direct-electronic access (DEA) trading at broker-dealers: the UK Financial Conduct Authority’s algorithmic trading compliance in the wholesale markets and Commission Delegated Regulation 2017/589 (CDR 589) to the second Markets in Financial Instruments Directive.

A qualitative examination of 15 semi-structured interviews with representatives of London Metal Exchange member firms, their clients and regulators.

This paper finds that the key conduct related messages in algorithmic trading compliance in the wholesale markets may not yet be fully embedded at broker–dealers. This is because of a perceived simplicity of the algorithms deployed by broker dealers or, alternatively, a lack of reflection on their impact. Conversely, a concern exists that clients’ deployment of algorithms on DEA channels provided by broker–dealers increase conduct risk. However, the threat of harm posed by clients is not envisaged in current definitions of conduct risk. Accordingly, CDR 2017/589 does not currently require firms to evaluate clients’ awareness of it.

This study’s findings are limited to the insights provided by 15 participants.

This paper contributes to existing research by deepening understanding of conduct risk arising from algorithmic trading and DEA. To account for the potential harm arising from clients’ activities, this paper proposes a revision to Miles’s definition of conduct risk. This is complemented by a proposed amendment to CDR 2017/589 to require evaluation of clients’ understanding of conduct risk.

The purpose of this study is to provide an overview of some of the deficiencies in the criminal justice system in Jamaica, particularly relating to financial crime. The author also examines possible alternatives in the approach that may be taken in tackling financial crime.

The methodology used was a review of data on financial crime in Jamaica as well as recent significant cases. An analysis of key pieces of legislation was also undertaken. In some instances, a comparative approach was invoked, with special reference to the UK and US laws.

Some essential findings include the positive impact that may be gained from restorative justice principles, the effective enforcement of asset recovery provisions and stricter regulation of the financial services industry.

There is no similar comprehensive examination of these issues concerning Jamaica.

The paper’s aim is to consider how best to formulate sturdy regulatory frameworks for RegTech and SupTech. The paper appraises how key features of EU and UK regulatory and policy initiatives can contribute to a functional framework for RegTech and SupTech.

The paper refers to the most comprehensive empirical findings within the EU and the UK on RegTech and SupTech, including reports released by the European Banking Authority and the Bank of England. As data is only gradually becoming available about the true rate of adoption of RegTech and SupTech, the paper identifies salient areas that warrant analysis from emerging findings. In light of the relatively restricted sources of empirical data, the article’s methodological approach is directed towards the most wide-ranging and detailed sources that are currently available at EU and UK levels.

The paper reveals distinct variations in how the EU and UK have pursued regulatory approaches towards RegTech and SupTech growth. However, there are many shared features in the respective approaches. The paper argues that a regulatory framework should ideally be imbued with overarching strategies and policy objectives, as well as with practical measures through innovation facilitators, such as sandboxes. Yet, legislative (top-down) intervention will be the significant ingredient in guaranteeing legal clarity for RegTech and SupTech.

By understanding the nuances in EU and UK approaches, the paper advocates for pragmatic reasoning when formulating a regulatory response. The importance of the article is in its focus on the elements of EU and UK regulatory approaches that are most capable of guaranteeing clarity on standards relating to RegTech and SupTech. The paper makes a vital contribution to existing commentary by determining how a balance can be struck between “top-down” and “bottom-up” types of regulation (i.e. should regulation be entirely concerned with industry-driven standards, such as codes of conduct?).