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FSA targets banks to fund budgets

The Financial Services Authority (FSA) has announced plans to increase the amount of money which the UK financial sector contributes to the FSA budget. At the same time the FSA has announced that its budget will increase by 10% to nearly £455 million in 2010/11 which is an increase of around £40 million. However, it looks as though an across-the-board increase in levies and fines may not be the way forward.

There is now a growing movement towards increasing the levy on those larger companies which often require more time to regulate and monitor. While in principle this makes perfect sense, in practice it will obviously create something of a backlash from the UK financial arena with major banks and major financial companies set to see their operating costs increase yet again. However, when you bear in mind the success of the FSA over the last two years with regards to various prosecutions and fines it is difficult to argue against making those who take up more time pay more money.

Initially it was thought that the Conservative party would look to reduce the power of the FSA, or even close down the operation, put recent successes would appear to have made the Conservative/Liberal Democrat government think again and it looks as though the FSA will now receive the full backing of the UK government and the Bank of England.

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