In response to the news that KPMG has ‘rejected’ the size of the fine given to it by the Financial Reporting Council (FRC), today’s post will discuss some of the dynamics of financial penalties. We have analysed the FRC a number of times in Financial Regulation Matters , and it will be important to assess whether the recent pressure being heaped upon the regulator has had the effect of changing the dynamic within that particular regulatory sector. However, it will be worth looking into the issue of financial penalties moreover, to ascertain whether they are considered effective enough, and if so then why that may be. The news story that initiated today’s post can be found in The Times , and runs under the headline ‘KP MG rejects size of misconduct fine’ . The fine is based upon the auditor’s performance when auditing BNY Mellon, and specifically in relation to its recent £126 million fine from the FCA regarding the mixing of institutional and client assets. KPMG has admitted th

The issue of short-term lending and its connection to the post-Crisis era has been discussed on a number of occasions here in Financial Regulation Matters , most notably here and here . We discussed how the growth in this particular market was borne out of a desperation experienced by citizens who were, for the most part, struggling to make ends meet. One of the largest players in that field was Wonga, set up in 2006 just before the Crisis hit the Western world. In this post, we will look at Wonga’s recent collapse and discuss what its collapse may mean, both for consumers and the marketplace moreover. In a previous post we discussed how, in June 2017 the Financial Ombudsman revealed that consumer complaints against Wonga and other similar lenders had exploded by 227% . That increased rate of complaints has subsequently been cited as being one of the core reasons behind Wonga’s recent collapse. The Guardian notes how the company ‘ collapsed into administration after it was bro