It's all very well to issue regulatory guidance – but
it's what you do to enforce it that really counts. The UK
financial services regulatory agencies have imposed fines exceeding
$2 million on a UK bank that did not implement enough oversight on
an outsourced provider of technology services.
Summary
In a move that emphasises the firmer approach being adopted by
UK regulators when it comes to compliance with technology
outsourcing rules, the Financial Conduct Authority (FCA) and the
Prudential Regulatory Authority (PRA) have jointly fined R. Raphael
& Sons plc ("Raphaels") £1,887,252 for failing
to properly manage its technology outsourcing arrangements between
April 2014 and December 2016. This fine followed an investigation
by the FCA and PRA which revealed that: "Raphaels'
systems and controls supporting the oversight and governance of its
outsourcing arrangements were inadequate and exposed customers to
unnecessary and avoidable harm and inconvenience".
