Dr Charles Tannock

Member of the European Parliament for London

Insider dealing and market manipulation (market abuse)

Delivered in Plenary - 10 September 2013

Mr President

The financial services industry is one of the UK’s economic strengths and particularly for the City of London, which I represent. Such importance, however, should not exclude the industry from supervision and effective policing and regulation where necessary. The revelations of the LIBOR benchmark manipulation are just one high-profile example of the current scope for unscrupulous operators to abuse or manipulate the financial markets.

It is noteworthy that in the UK there have been very few prosecutions under the existing laws to deal with insider dealing. To regain the public’s confidence in the industry now, it is absolutely essential that a zero-tolerance approach is taken and that those found to be abusing the system are criminally prosecuted. This proposal under Ms McCarthy’s report will introduce fines of up to 50% of turnover for companies that commit unlawful behaviour, as well as providing the option of imposing bans on operating, but I believe that custodial sentences also need to be considered. This will act as a real disincentive to those who are tempted to break the rules and will give the public, which are generally hostile to the banking sector and to financiers, confidence that regulatory control has improved and has been re-established.