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I think your last sentence says it all. Fines look good to the public but most firms will carry a contingency fund to pay fines as and when they arise, based on the premise that they will be hit occassionally. Firms also work on percentages based around
how many times they can get away with a dubious trade for example, before taking a hit. The likelihood is they will make money in the end.
As for fining the individual, well this could make a trader so cautious that there may be a possiblity of a market not being a fair one. Remember, ultimately the market objective is to take risk. Would you stick your neck out if you knew that the firm was
not ptoviding support?
Regulations need to be clarified not increased so that firms know where they are and the regulator can pick on misdemeanours quickly and impose fines, sanctions or suspensions almost immediately rather than the time it takes now. We also need to change the
culture but I fear that is a long way off.
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This post is from a series of posts in the group:
A discussion of trends in innovation management within financial institutions, and the key processes, technology and cultural shifts driving innovation.