#TAGtribe Blog – Quis custodiet ipsos custodies Who will guard the guards? by Kevin Bottwood – @KFB58

Quis custodiet ipsos custodies Who will guard the guards?

I attended a meeting today where we as a business won some work.  Pleased I asked why they had called us; it was a referral – nice.  However it got me thinking, there is an increasing emphasis on the Bribery Act and associated issues surrounding corruption.  So when does a referral become an issue?  On this particular occasion a relative of the business in question had attended a seminar given by me and obviously thought I knew what I was talking about and recommended us without our even being aware of it.  In the same way if I need a plumber I will ask around and employ one with a proven track record.  If he or she gets it wrong they will be back! So far so good. 

Catching up with Kate from London & Partners

 However let us look at the thorny issue of a regulated entity of whatever size receiving a visit from their regulator, a bank for instance receiving a visit from the FSA.  Significant issues arise and the regulator imposes an obligation on the bank to bring in outside experts to solve the problem.  Sounds like common sense to me.  However the regulator strongly suggests that the relevant outside agency should be one of the big four for example.  Is the bank going to go against that suggestion?  I doubt it, after all the bank wants a clean bill of health moving forward.  

So where did the regulator get the idea that one of the big four are the best people to carry out such a visit?  In fact on many occasions it is not necessary to look beyond the nature of mankind.  It is the easiest option for the regulator on the assumption an organisation of such size will get it right.  Really?  Anyone watching or remotely interested in the recent debacle in Ireland will note that a bank the size of Anglo Irish are toxic in its entirety. Who were there auditors/accountants?  No auditor I would suggest relying on big fat fees is going to fall out with their client. Noting that does the relationship between the regulators and the big four amount to cronyism/cupidity/stupidity or laziness?  I will let you work it out. So does it amount to corruption?  Bigger is not always better.  Which brings me neatly back to the title if the regulator cannot get it right? 

Quis custodiet ipsos custodies Who will guard the guards?

 

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