AP News

UK regulator hands big fine to ex-HBOS executive

LONDON (AP) — A former executive of Halifax Bank of Scotland was fined 500,000 pounds ($805,000) by Britain's financial services regulator on Wednesday for his role in the bank's collapse.

The Financial Services Authority also barred Peter Cummings from holding any senior banking position in Britain.

Cummings was head of corporate banking at HBOS during a period of rapid — and little regulated — expansion that preceded the global banking crisis of 2008.

FSA director of enforcement Tracey McDermott said Wednesday that Cummings "presided over a culture of aggressive growth without the controls in place to manage the risks associated with that strategy."

"Instead of reacting to the worsening environment, he raised his targets as other banks pulled out of the same markets," McDermott said.

HBOS was sold to rival Lloyds in 2009 to save it from collapse, and the combined bank was bailed out by the British government.

Cummings condemned the authority's investigation into his activities as "Orwellian."

"Many people must bear collective responsibility for what happened, including governments and regulators as well as the boards of the banks themselves," he said.

"But the fact that I am the only individual from HBOS to face investigation defies comprehension."

The FSA said it would start work on a report into the reasons for the failure of HBOS now that "enforcement proceedings" were over.

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