PRA fines TSB CIO
The Prudential Regulation Authority (PRA) has fined Mr Carlos Abarca, the former Chief Information Officer (CIO) of TSB Bank plc (TSB), £81,620 for breaching PRA Senior Manager Conduct Rule 2 as he failed to take reasonable steps to ensure that TSB adequately managed and supervised appropriately its outsourcing arrangement in relation to its 2018 IT migration programme.
This follows on closely from the enforcement action taken in December 2022 against TSB for operational resilience failings, which resulted in a joint financial penalty of £48,650,000 imposed by the PRA and Financial Conduct Authority (FCA).
As CIO of TSB, Mr Abarca had responsibility for TSB complying with the PRA’s outsourcing rules. In particular, he was responsible for TSB’s key outsourcing relationship with its main third-party supplier for the IT migration programme. As part of this, he gave assurance to the TSB Board that the third party, as key supplier, was prepared for migration. However, he failed to ensure that TSB had itself obtained sufficient assurance from the third party before doing so.
Sam Woods, Deputy Governor for Prudential Regulation and Chief Executive Officer of the PRA, said:
“Senior managers have an essential role to play in ensuring that firms manage and supervise outsourcing effectively. In this case, the PRA has fined Mr Abarca because his management of a key outsourcing relationship fell below the standard we expect.”
Prison sentences for insider dealing duo
The Monetary Authority of Singapore (MAS) has confirmed the conviction and sentencing of two individuals, Mr Tay Yew Khem and Ms Hui Choy Leng, for insider trading and other offences under the Securities and Futures Act and the Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act.
The charges relate to the purchase of shares in Broadway Industrial Group Limited (BIGL) based on non-public and material information received from the company’s then Chief Financial Officer, Mr Tan Chee Keong. After the company’s announcement of its sale of two businesses, both Mr Tay and Ms Hui sold BIGL shares and made profits, with Mr Tay also giving a share of his profits to Mr Tan.
Mr Tay pleaded guilty and was convicted of two charges of insider trading and one charge of transferring benefits from criminal conduct. Ms Hui also pleaded guilty and was convicted of two charges of insider trading, with additional charges taken into consideration for sentencing. Mr Tay and Ms Hui were both sentenced to imprisonment, with Mr Tay receiving 12 weeks and Ms Hui receiving 4 months. The individuals have also paid disgorgement of their share of profits from the offences.
The convictions resulted from a joint investigation by the Monetary Authority of Singapore and the Commercial Affairs Department of the Singapore Police Force, following a referral by the Singapore Exchange Securities Trading Limited.
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