UK Financial Services Authority imposes first fine for breach of Model Code

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On 14 February 2013, the UK Financial Services Authority (FSA) fined Nestor Healthcare Group £175,000 for failing to take proper and reasonable steps to secure the compliance of its board members and senior executives with the share dealing provisions of the Model Code.

Despite implementing a share dealing policy, adherence to which would have satisfied its obligations under the Model Code, Nestor failed to take reasonable steps to ensure adherence to its policy and to review and update it. In addition, the FSA found that Nestor did not maintain adequate procedures, systems and controls to ensure its persons discharging managerial responsibilities (PDMRs) complied with their obligations under the Model Code.

The fine is the first of its kind and highlights that implementation of a share dealing policy on its own is not sufficient to meet the requirements of the Model Code…

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