FSA 'should step up crime fight'

The FSA needs to do more in the fight against crime, the NAO says

The Financial Services Authority, the City watchdog, needs to do more to combat financial crime, a report says.

The National Audit office (NAO) said the fight against crime had received "less attention than other elements of the FSA's responsibilities".

In particular, the FSA needs to step-up its policing of small firms if it is to combat crime better, the NAO said.

However, the NAO said the FSA was doing a good job overall in protecting and educating consumers.

It worked well with other UK regulators and helped boost financial capability, the NAO concluded.

NAO head Sir John Bourn said the FSA had done well creating "strong and effective structures".

Copybook blotted

The one area where the FSA could do better, however, was in the fight against financial crime, the NAO said.

The FSA spends 10% of its annual budget combating crime. However, instead of calling for this percentage to be increased, the NAO said the FSA needed to spend the money more wisely.

"The FSA could improve the effectiveness with which it uses the current level of resources, " it said.

The report also said the FSA needed to decide whether "greater weight should be given to (financial crime at) smaller firms than at present."

In response, the FSA said it had recently formed its Financial Crime and Intelligence Division to increase its effectiveness at combating fraud and improve staff training.

"On the whole, this is a positive report but there is always room for improvement," an FSA spokesman said.