FSA fine was ‘a little bit sinister’

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THE former head of corporate lending at HBOS Plc has described a record fine and lifetime ban handed to him by the UK’s financial regulator as “unfair” and “a little bit sinister”.

Peter Cummings, who held his position at HBOS until it was rescued by Lloyds, was fined £500,000 by the Financial Services Authority (FSA) in September and given a lifetime industry ban.

“It is unfair, and it ... also seems a bit sinister,” Cummings said in a private session of a UK Parliamentary panel on banking standards, after being asked if he felt singled out.

He refused to blame any individuals at HBOS for its near collapse and rejected the FSA’s claim that he had led a “culture of optimism” at the bank.

“I am absolutely heartbroken about what happened, and I live with it every day, but it would be inappropriate of me to point the finger at any colleague. I have not done it to the FSA, and I am certainly not going to do it to a parliamentary commission,” he said.

However, he was scathing of the FSA process around his treatment and fine.

“Frankly, it was like living in an American soap opera. I find it bewildering, bizarre and downright impossible to believe this country has an organisation that is out of control to the extent that it is.

“I think it is unacceptable behaviour,” he said.

The session was held in private on November 27 because of Cummings’s ill health. A transcript was released on Friday.