A new rule book for the UK banking sector will see the Financial Conduct Authority (FCA) carry out an annual MOT of thousands of staff to ensure they are fit and proper to perform their duties.
The new rules will be announced later today in a speech by FCA chief executive Martin Wheatley, prior to a period of consultation. The rules are expected to come into force around March next year. The story was first reported by Sky News.
The new regime is without doubt a reaction to the slew of scandals and impropriety to blight the banking sector in recent years. It has also emerged out of recommendations made by the Parliamentary Commission on Banking Standards in its report of 2013.
In a consultation document last year, the FCA said: "The (Banking Reform) Act has introduced... the requirement for firms to certify certain employees as being fit and proper to perform certain functions.
"This originated from the PCBS's recommendation that a 'licensing regime' be introduced to address concerns that the existing Approved Persons Regime brought too narrow a set of individuals within the scope of regulation, and that firms took insufficient responsibility for the fitness and propriety of their staff."
The Prudential Regulation Authority (PRA), which sits within the Bank of England, has also issued a new rulebook which will shift responsibility for failings at banks squarely upon the shoulders of senior managers, rather than deflecting the onus for some decision making towards non-executive directors.
The PRA will also announce details of new banking strictures, covering staff working at UK branches of overseas firms.