Today’s post acts as a sequel to a previous post here in Financial Regulation Matters that was concerned with ‘Public Finance Initiatives’, or PFIs for short. In that first post, the PFIs were established as a good idea captured by private greed, ultimately posing a great threat to society at a time where greed can have generational consequences over and above that caused by the Financial Crisis. The focus of the post was on the cross-party support for these initiatives, with their output being vastly overvalued and the tab being taken on the by the citizens of the U.K. However, in this post, we will look at the PFI issue from within the confines of tax, or more precisely the lack of it, that is derived from these initiatives. However, there is something important that needs to be declared before the post continues, and that is that this post does not aim to fall in line with a certain political party’s denouncement of all things private i.e. the current incarnation of the Labour ...

Today’s post can be seen as somewhat of a ‘round-up’ of recent news concerning the Financial Conduct Authority (FCA). With the FCA featuring considerably in the news recently – amid the obvious cries of ‘what’s new!’ – it is worth discussing these particular elements for the purpose of asking some abstract, potential philosophical questions like ‘what is the role of the regulator in reality ?’. The FCA has figured heavily already here in Financial Regulation Matters , particularly in relation to the regulator’s actions with regards to the ever-increasing debt bubble , and also the conduct of RBS a. in general and b. in relation to the ‘ controversial ’ i.e. potentially criminal ‘ Global Restructuring Group ’ and its systemic destruction of many small businesses. So, in furtherance of these analyses, the following provides ‘updates’, for want of a better term, to the developing progression of the FCA as a leading regulator in the U.K. There are a number of stories recently that ...

Today’s post reacts to the news that BMW, the famous German auto-manufacturer, has been raided by the European Commission’s (EC) antitrust division as part of an investigation into collusion between the largest German auto-manufacturers. In this post, the focus will be on the details of the investigation, as far as we can know at this very early stage, and then on contextualising that against the larger picture for auto-manufacturers. Ultimately, although operating in opposition to the supposed ideals of the marketplace i.e. private and independent business, the reality of the situation is that in this particular industry collusion is rife, and arguably necessary – depending upon one’s position. The EC raided BMW’s Munich offices last week in the latest development of an investigation into collusion between the largest German auto-manufacturers. The investigation, which began earlier this year, is based upon the allegations that ‘ Volkswagen, Audi, BMW, and Daimler has for year...

In today’s post the focus will be on the banking sector and, by focusing on three current issues, provides an overview of recent developments within this particular sector. By looking at the issues surrounding Barclays, HSBC, Standard Chartered, Lloyds, and RBS, a picture will be painted that details the need to ask much deeper questions about the role the banking sector plays within society and, perhaps more introspectively, the relationship between big business and humanity. Going through the issues in no particular order, the first stop in today’s journey takes us to Barclays, with the news emerging that Red Kite Management, the world’s largest metals hedge fund, is suing the British Bank for ‘ alleged market abuse in the copper market ’, which it claims has cost the company at least £650 million between 2010 and 2013. The company’s claim, according to documents filed with the High Court, is that the Bank allowed some of its staff to share confidential information with the Ba...

Today’s post reacts to the recently published Parker Review , which is a final report led by Sir John Parker in association with Ernst & Young and Linklaters. The report, entitled A Report into the Ethnic Diversity of UK Boards , aims to shine a light on the issue of representativeness on FTSE Boards, with a specific focus on FTSE 100 Boards, and then prescribe some recommendations which it hopes will have a positive effect in this particular field. So, in this post, we will take a closer look at the Report and assess whether it may achieve its aims and, more importantly, whether its aims are even useful or correctly constructed in the first place. We have looked at this issue of representativeness at Board level before here in Financial Regulation Matters , but mostly from a gender-related viewpoint ( here and here ). However, as the Parker Report states in its preamble: ‘ U.K. Boards have made great progress on gender diversity but we still have much to do when it comes t...

This post focuses upon two particular elements that have been somewhat of mainstays here in Financial Regulation Matters , and those are the Treasury Select Committee and the tuition fee issue in the U.K. Upon Andrew Tyrie’s departure as Chair of the Treasury Select Committee in April of this year, we asked who it would be replacing him and how vivacious would they be in utilising the considerable influence that the Committee has. We had a brief taste of what Tyrie’s successor – Nicky Morgan – had to offer with her preliminary calls for RBS to release the controversial and likely extremely damaging report into the conduct of its ‘Global Restructuring Group’. Now, Morgan is returning to her old stomping ground from her time as Education Secretary and is launching an enquiry into the student loan system , ultimately aiming to examine recent policy changes like the tripling of tuition fees and the recent hike in interest rates related to the loans taken by students. So, today’s post ...

In today’s post, the focus will be on a few potential M&A (Mergers and Acquisitions) deals that the British competition regulator, the Competition and Markets Authority (CMA), is currently dealing with. Whilst also serving as a review of the recent business news in this field, this post will seek to analyse the complex nature of the CMA’s task and all of the aspects that it must consider; the effect of their decision in a given case will, by its very definition, go on to have massive consequences for those businesses involved and, more importantly, the public which is exposed to the effects of these potential deals. What we will see is that, in a number of cases, the balance which is aimed for will weigh heavier on any given side, but finding a solution to this is almost impossible, if even desirable. First up for us is Tesco and its proposed deal to take over the wholesale company Booker, which is something we have analysed before here in Financial Regulation Matters . The...

Today’s post looks at the story of the ‘fearless girl’ statue that was erected directly opposite the famous ‘charging bull’ on New York’s Wall Street, and the news today that the asset-management company behind its creation have agreed to pay a settlement fee of $5 million to settle ‘ federal allegations that it paid female executives less than their male counterparts ’. Whilst one may suggest that this chain of events is ironic, it is put forward here that what it actually represents is an accepted understanding on behalf of those in power that the public can be easily swayed, as long as the right people fight for the powerful (whether knowingly or not). In reality, the fearless girl statue, which stands as a symbol of defiance and the demonstration of equality, serves to mask systemic inequalities between men and women, and between different ethnicities; unfortunately, even ardent supporters of the public’s cause have fallen foul of this symbol-driven misdirection. Rather than...

Today’s post aims to present somewhat of a round-up of a number of pieces of news coming from the Airline industry in recent weeks (and months) because, recently in particular, the divergence between those in the industry doing well and those that are not seems to be growing at a particularly rapid rate. Recently we looked at the trade battle that is developing between Boeing and Bombardier , but in this post the focus will be on the recent collapse of Monarch, Air Berlin, and the troubles at Ryanair, although it will be discussed that not all airlines are feeling the heat in this marketplace, with certain players making significant moves to take advantage of their competitors’ downfall or change in strategy. Firstly, the two stand-out stories from the airline industry are worth analysing because the effect that they are having will be felt for some time. In August of this year, Air Berlin filed for bankruptcy after its leading shareholder, Etihad Airways, withdrew financial su...