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Sock it to them, Hans

Hans de Gier, chairman and chief executive of Warburg Dillon Read, didn't mince words at the grand opening of the Financial Services Authority (FSA) in Canary Wharf on June 1. Batting third in an impressive line-up of speakers, he warned that the FSA's approach to regulation risked "embodying the worst of both worlds: high-level principles interpreted and applied separately from detailed rules designed on a one-size-fits-all basis".

Certainty of expectations was a basic principle of discipline "as any childcare handbook will tell you", he said, apparently still smarting from the Securities & Futures Authority's action on Warburg's use of derivatives in the Northern Electric affair back in 1994. Disciplinary action should be decided "not only in the light of the gravity of the offence, but also in the light of firms' admissions of breaches and remedial actions taken", de Gier said. Asked whether this meant that, after strangling one's neighbour's dog, one should get a discount if one admits the offence, de Gier replied: "There are quite a lot of practices that contravene rules and regulations, but should that always mean a public beating-up? I think there should be flexibility, not an automatic discount."

Discipline behind closed doors, however, might mean the FSA, as a statutory body, could run foul of the European Commission on Human Rights for infringing the right of individuals to speak out.

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