Terminated: City Sheriff Shot Down

The tough talking Martin Wheatley finally decided to resign last month. But it was for the wrong reason, i.e. vanity. He was unhappy about his boss George Osborne’s refusal to renew his contract as head of the Financial Conduct Authority (FCA) in March 2016. Whilst Wheatley does not accept the excesses of his four year stint as City Sheriff, many in financial circles are nonetheless breathing a sigh of relief that his reign of terror is over. A trigger-happy sort of chap, unlike his iconic predecessors (e.g. Howard Davies, Hector Sants etc) whose shoes he just couldn’t fill, Wheatley persistently failed to command the respect of the financial elite. The shot down sheriff will be temporarily replaced by his deputy Tracey McDermott (who will temporarily act as CEO from 12 September 2015) and Andy Haldane (the Bank of England’s Chief Economist) has been tipped as his permanent replacement. Wheatley, who became globally infamous for his fierce crackdown on the cheating that has historically infected financial services, reportedly said that he is disappointed to be leaving his job because he had some unfinished business to settle; apparently, the cure had not fully been delivered. The caped crusader’s legacy has been one of lumbering the banks with fines, authoring the Wheatley Review (which was germane to reforming LIBOR/benchmarks) and co-authoring the equally seminal Fair and Effective Markets Review with the Bank of England and HM Treasury.

Despite having resigned, Wheatley will apparently stay on at the FCA in an advisory role and he will be paid until July 2016 irrespective of his actual exit in January 2016. He received more than £700,000 in compensation last year. His work has been hailed as the blueprint for oversight of financial benchmarks and has come to form the bedrock of the conduct regime. Equally, his tenure had a lot to do with fear and loathing in the City and mischievous individuals in financial services must be hugely tickled that the terminator himself has been terminated. On the other hand, some were of the view, that his systemic efficiency was little more than a lot of huff and puff. For example, on the subject of third party rights the Court of Appeal – see the long read – thought that his FCA failed to follow proper legal channels and truncated procedures when wrongdoing was penalised and regulatory action was taken. As far as Gloster LJ (with whom Longmore and Patten LJJ agreed) could see, the wheels of justice had simply turned too fast and third party rights had suffered as a result: in other words, enforcement had become redolent of the law of the jungle, the judgment is being appealed to the Supreme Court.