Investigation into financial services sector for suspected anti-competitive practices

First published by Author on January 25, 2019 in the following categories: Industry Latest and tagged with cma | investigations

The CMA opened an investigation into the financial services sector for suspected anti-competitive practices at the end of last year.

The investigation has only just begun, so no assumptions are made as of yet. The particular companies who may be of interest in the investigation are yet to be named, and it’s the initial information-gathering stage that has begun.

The financial services sector is a huge one, so healthy competition is important. Any breaches of the law will need to be punished accordingly.

Investigation into financial services sector for suspected anti-competitive practices opens

It’s official. The CMA (Competition and Markets Authority) has opened their investigation into the financial services sector for suspected anti-competitive practices.

The CMA commenced the investigation in November 2018. They expect to be gathering initial information and making requests for data from relevant stakeholders until August this year.

The reasons for the investigation is over suspicions of anti-competitive arrangements. We don’t yet know whether this means cartel behaviour, market sharing or price fixing, but we expect we’ll find out soon enough.

The CMA has reportedly agreed to lead the investigation instead of the Financial Conduct Authority (FCA) who hold similar powers.

Can the CMA punish the financial services sector for suspected anti-competitive practices?

The CMA has the power to punish organisations in the financial services sector for suspected anti-competitive practices.

This could mean fines in the millions and undertakings to not engage in such behaviour again, and further undertakings as to their ongoing behaviour.

However, if any organisation comes forward as a whistle-blower, they may either receive a reduced fine or no fine at all. We don’t yet know whether the reasons for the investigation was triggered by a whistle-blower. If it wasn’t, an organisation involved in anti-competitive practices (if this is indeed the case) may soon come forward to avoid punishment.

This of course can be useful in helping the CMA conclude their investigations quicker and with the use of fewer resources.

We’ll be keeping a close eye on this one!