Guidance on FSA Dawn Raids

Introduction

As is evident from the recent press coverage the FSA is using its powers under the Financial Services and Markets Act 2000 (FSMA) to conduct raids on premises for information with more confidence and frequency than ever before. This note sets out the basis on which the FSA may use its powers and also guidance on how entities should prepare for the possibility of, and respond to, dawn raids. It does not deal with the general right the FSA has to visit the premises of authorised firms when exercising its supervisory powers.

The Law

Section 176 FSMA gives the FSA power to apply to a justice of the peace for a warrant for the entry of premises for the inspection and copying of documents and information relating to on-going investigations. Before a justice of the peace can issue a search warrant, he will need to be satisfied that there are reasonable grounds.