FSA power to prosecute
R v Rollins [2010] UKSC 39– CASE NOTEThis 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
Categories: 5th edition, Chapter 17, updates