SFO has published a short press release noting that it has been working closely with FSA with regard to the above and is considering whether it is “appropriate and possible to bring criminal prosecutions”. SFO hopes to come to a conclusion on this within a month. In HoC this afternoon, Daviid Cameron announced a parliamentary review of the banking sector to be headed by Andrew Tyrie, TSC chairman. A transcript of Hansard should be available tomorrow and will appear in the next news update.

George Osborne has made a statement in HoC in the light of the FSA/CFTC action against Barclays. He reports that FSA is continuing to investigate the conduct of a number of other banks in relation to LIBOR and then raises the broader issue of financial regulation, noting that LIBOR was not regulated under FSMA. He adds “we will examine if there are any gaps in the criminal regime inherited by this Government and we will take the necessary steps to address them. I cannot comment today on possible criminal investigations into inpiduals involved in this activity. The authorities are exploring every avenue open to them but, shockingly, the scope of the FSA’s criminal powers, granted by the previous Government, does not extend to being able to impose criminal sanctions for manipulation of LIBOR. As part of our review into LIBOR and the strength of the financial regulatory architecture, we are examining whether strengthening the criminal sanctions regime for market abuse and market manipulation is warranted, and if so, we will provide for these powers quickly”. George Osborne notes that HMT is to publish a consultation in response to the report on the failure of RBS next week which will consider the possibility of criminal sanctions for directors of failed banks when there is proven criminal negligence. It is noted that the Government is considering amendments to the Financial Services Bill to ensure that “fines of this nature go to help the tax-paying public, not the financial industry. I have also asked my officials to investigate urgently whether that legislation could be applied to the fine imposed on Barclays Bank”. Ongoing discussions are taking place between FSA and SFO on the case of inpiduals being investigated in the LIBOR case. A link to the transcript of George Osborne’s statement and MPs’ reactions follow.

This consultation paper sets out ESMA’s proposals for guidelines on UCITS ETFs, index-tracking UCITS, efficient portfolio management techniques, total return swaps and strategy indices for UCITS. The formal proposals for guidelines are contained in the boxes in Sections II to VIII of the paper, while further commentary and explanation is provided in the explanatory text. Responses are required by 30 March 2012. ESMA notes that it will take into account responses to the paper in finalising the guidelines for adoption in Q2 2012.