At the meeting, John Tiner provided a report on the FSA's ongoing investigations. These investigations have included: reviewing some 780 files of evidence; entering 51,000 records on the inquiry's database; listening to some 27,000 taped conversations; 17 site visits; and well over 70 interviews. The 60-strong investigative team has: examined prospectuses and financial promotions; looked closely at the numerous restructurings and new issues that took place in the splits sector during 2000-2002; analysed company accounts; traced cash through various transactions; and looked in detail at related transactions in stocks.
After sharing some of the information that it has gathered, together with its preliminary analysis of what took place in the sector during the period under investigation, the FSA then suggested that the firms involved consider taking part in collective settlement negotiations aimed at ensuring that:
- firms pay compensation to investors where, appropriate; and
- disciplinary action is taken, where appropriate.
The FSA's objectives in conducting its investigations, which have not yet been concluded, have been to secure adequate compensation for investors who have suffered financial loss and to assist in restoring market confidence in the investment trust sector. It believes that these objectives would best be achieved if there was an early resolution of the investigations and has urged firms to give serious consideration to the merits of its proposal.
The FSA does not propose to make any further statements on the progress of these discussions until they are concluded. The FSA has requested firms not to comment on the meeting.
