The Financial Conduct Authority and the Serious Fraud Office have signed a joint deal to co-operate more extensively on investigations including launching joint probes.
The deal may mean more joint investigations launched by the two organisations with staff working as a “single team.”
Both say the deal, signed earlier this month, will mean closer co-operation but no new rules or obligations are being created.
The deal may mean a tougher joint approach to financial crime which has risen substantially in recent years with the SFO becoming more involved in probing regulated firms.
The ‘Memorandum of Understanding between the FCA and SFO’ will see the two bodies potentially running joint investigations or parallel investigations and swapping information and potential evidence more frequently.
The co-operation deal is also designed to, “promote and facilitate the sharing of information between the FCA and SFO.”
The agreement was signed for the SFO by Sara Lawson KC, general counsel and Therese Chambers, executive director of enforcement and market oversight.
Under the deal the FCA and SFO will notify one another of any investigation or pre-investigation, “of mutual interest” at the earliest opportunity. Staff will discuss at the outset whether there is a need for a joint investigation or parallel investigation.
The FCA will also consult with the SFO in “matters of mutual interest” before settling a case or proceeding to Warning Notice stage to allow the SFO to consider whether to ask the FCA to defer proceedings temporarily or forgo settling at that time. This means that the FCA may hold off issuing a warning notice if the SFO asks for a delay so it can carry out further investigations into a case.
The new agreement replaces the Joint Protocol signed by the FCA and SFO in May 2014.
Both says that information will only be exchanged, “where it is lawful to do so.”
In future, senior leaders from the SFO and the FCA’s Enforcement and Market Oversight Division will meet on a regular basis to discuss matters of “key importance” to both organisations relating to strategy, policy and collaboration. They will also discuss the status of any live investigations being conducted by the SFO and the FCA
When investigations are launched the FCA and SFO say they will consult with one another before making any public statements or issuing communications about any investigation where the other is providing assistance.
In the memorandum, the FCA and SFO add that it will be “inappropriate” for either the FCA or the SFO to comment on an investigation being undertaken by the other.
• Memorandum of Understanding between the Serious Fraud Office and the FCA [PDF]
