LONDON Britain is likely to be alone in introducing a mandatory system of accountability for senior currency traders linked to a new global code of conduct, the Australian official leading work on the code said on Wednesday.
Guy Debelle, heading the Bank for International Settlements committee that has been working on the code of conduct for the past year, said its next sections to be unveiled over the next month would stick to a general principle of voluntary adherence.
But he said the committee was also considering a system of widespread attestations, where banks and other financial firms or senior officials at particular firms would specify whether their businesses observed the code's rules.
That chimes with the United Kingdom's new senior managers' regime, a response to public anger at how few individuals at banks have been punished after taxpayers had to bail out lenders in the 2008 financial crisis.
The regime makes leading figures in banks and insurers legally accountable for the behaviour of their employees, making it easier for regulators to pin blame on people.
The government has proposed rolling out the regime to senior managers in currency, commodity and bond markets as well, but the global plans from the BIS would not be mandatory.
"The code is not regulation but we are looking at a number of mechanisms that have teeth," Debelle told Reuters on the sidelines of the TradeTech FX conference in London.
"One of those under consideration is a widespread system of attestations, one at an appropriately senior level; two, some kind of public display of that; and then three, some sort of collection."
Asked if that meant UK regulators would make managers accountable for keeping to the code under the senior managers' regime, Debelle said:
"I would say that is very likely. I would see those two things as working together here. Obviously that (regime) does not exist elsewhere, but given how big a part of this market London is, that is a good thing."
He said UK officials including the Bank of England's Chris Salmon were likely to give more detail on the issue in the weeks ahead.
He also said he expected to circulate the first full draft of the code, including additional sections on electronic trading and adherence, among market participants in October. The final version is due to be published next year.
(Additional reporting by Huw Jones; Editing by Hugh Lawson)