The Financial Services Authority is casting its net across three continents in the search to find a head of enforcement to replace Margaret Cole.
The FSA has appointed headhunting firm Sainty Hird to run the search process. Potential candidates include external regulators from North America and Asia, bank executives and lawyers, as well as the FSA’s acting enforcement director, Tracey McDermott.
The role will be a top position within the Financial Conduct Authority, which is due to be spun out of the FSA in the spring of next year. The worldwide search reflects the FSA’s role as a key international regulator.
Ms Cole announced her departure in February and is to join the UK arm of PwC as general counsel in the summer. Ms McDermott has been running the division since and has drawn praise from some in the City and the FSA staff for her forthright manner and tough attitude.
Martin Wheatley, who runs the FSA’s conduct division and will head the FCA, is said to have an open mind on whether to appoint internally or externally. He has been clear that he wants the FCA to be “much more interventionist” and “stand in the shoes” of retail investors.
For the enforcement arm, that is likely to mean building on Ms Cole’s successful run of insider trading probes to take on more complex cases and make good on the FSA’s long-standing promise to hold senior executives to account. The watchdog drew criticism for failing to bring enforcement actions against the leaders of Royal Bank of Scotland, and the FSA recently lost a test case involving a UBS senior executive who it alleged should be held accountable for failing to prevent misbehaviour in his department.
Mr Wheatley, who beat Ms Cole to the FCA chief executive post, was himself drafted in from Hong Kong last year. Despite the change of regime, Ms McDermott is widely seen as the favourite to secure a permanent position as head of enforcement. But a broad external search could throw up compelling candidates from three broad areas: bank litigation and compliance departments, foreign regulators and law firms.
Among those being considered for the role are Mark Steward, who heads securities enforcement in Hong Kong and worked closely with Mr Wheatley, and Carlos Conceicao, a former FSA executive who is now at Clifford Chance. Four officials at UK arms of big banks are also on the list: Brad Gans, the Europe, Middle East and Africa general counsel at Citigroup, Mike Walters, Barclays’ head of compliance, and two Deutsche Bank lawyers, Kieran Garvey, a top litigator, and Simon Dodds, head of compliance.
Three North American regulatory officials are also potential candidates: Lorin Reisner, who recently came from the US Attorney’s office in Manhattan from the Securities and Exchange Commission, Steven L. Cohen, SEC associate enforcement director, and Tom Atkinson, who heads enforcement at the Ontario Securities Commission.