Overview

This bill aims to regulate short selling, increase transparency in pension fund investments, and ensure free basic bank accounts for retail customers in the UK.

Description

The bill comprises three main sections:

Short Selling Prohibition

It makes it an offense to create or increase a net short position in a UK-listed company, except for market makers (those providing liquidity to the market). Penalties for violations include unlimited fines or 12 months' imprisonment.

Pension Fund Disclosure

Pension funds must disclose in their annual accounts the quantity of shares lent for short selling, fees received, and share prices at the beginning and end of the lending period. Failure to comply results in penalties up to £100,000 for a first offense and unlimited fines for subsequent offenses.

Free Bank Accounts

Banks and building societies must offer at least one free current account and one free interest-bearing savings account to retail customers (those not using accounts for business purposes). Non-compliance is punishable by fines up to £100,000 for a first offense and unlimited fines thereafter.

Government Spending

The bill is expected to increase government spending due to enforcement costs and potential payouts for penalties. However, precise figures are not provided in the bill itself.

Groups Affected

• Financial Institutions: Banks and building societies will be required to offer free accounts, impacting their profitability. Investment firms engaged in short selling face restrictions and potential penalties.
• Pension Funds and Trustees: These entities face increased administrative burdens due to new disclosure requirements and potential penalties for non-compliance.
• Retail Customers: Will benefit from access to free basic banking services.
• Financial Services Authority (FSA): Will be responsible for enforcement and imposing penalties.

Powered by nyModel