FSA power to prosecute
R v Rollins  UKSC 39– CASE NOTE
This important decision of the Supreme Court substantially extends the prosecutorial powers of the FSA – and possibly other regulators.
Mr Neil Rollins, was charged with 4 counts of insider dealing contrary to section 52(1) of the Criminal Justice Act 1993, 1 count of insider dealing contrary to section 52(2)(a) of the Criminal Justice Act 1993 and 4 counts of money laundering contrary to section 327(1)(d) of the Proceeds of Crime Act 2002.
The Supreme Court held (Sir John Dyson giving the judgment of the court) the power of the FSA to prosecute criminal offences was not restricted to the offences referred to in sections 401 and 402 of FSMA 2000. In particular the FSA had the power to prosecute offences contrary to sections 327 and 328 of the Proceeds of Crime Act 2002.
In rejecting the Appellant’s submissions the court reasoned that before the enactment of FSMA 2000 the FSA was in the position of a private prosecutor and could initiate (subject to being empowered to do so by its memorandum and articles or association) a broad range of offences subject to statutory restrictions or conditions. It followed that prior to the enactment of FSMA 2000 the FSA could have brought proceedings under POCA 2002 had it been enacted at the time. It was therefore unlikely that Parliament intended to limit the powers of the FSA. The purpose of the relevant sections was therefore not to confer the right to prosecute but to limit the persons who might prosecute for such offences. The court further stated that there were rational reasons for including specific reference to insider dealing, offences of terrorism and anti money laundering, and it followed that there was no need to infer that Parliament must have intended to limit the powers of prosecution on the ground that there was no other explanation for their inclusion.
The Appellant’s submission that section 1(1) limited the FSA’s functions to those conferred upon it by the Act were also rejected. The court stated that the purpose of the section was to make it clear that the FSA rather than any other body was to have the functions conferred upon it by the Act. The section neither stated nor implied that the FSA’s functions were limited to those conferred on it by the Act. Accordingly, the FSA had the power to prosecute the relevant offences under sections 327 and 328 of the 2002 Act.
Comment; This decision of the Supreme Court places public statutory bodies in a position whereby they can potentially evolve beyond the intended scope Parliament prescribed. Does a scoping clause as set out in section 1(1) of the Act conferring powers simply mean that the relevant body merely had exclusive jurisdiction to the powers conferred on it by the Act, in addition to other powers of prosecution it chooses to take unto itself? It would appear so. There may be a real risk that powers of prosecution as to which authority prosecutes which offences will become increasingly the province of administrators in memoranda of understanding or other policy or operational decision making documents. Statutory bodies have an unfortunate tendency to push the boundaries of their powers in an attempt to fulfil what they see as their functions. This decision of the Supreme Court does little to dissuade them from those ambitions.
AC 6th Aug 2010
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