The UK’s fund management industry is “ripe for investigation” because of “an alarming lack of transparency that surrounds [its] pay and practices”, the influential Institute of Directors said on Sunday.
Simon Walker, director general of the IoD, said “uninterested” financial regulators should wake up “to avoid another scandal of epic proportions.”
Writing on the Guardian’s website, Walker said there are reasons to be proud of the fund management industry in the UK but argued that more clarity is required about how it operates “and most pertinent of all, how salaries are earned.” Without such openness, he said, fund managers risk losing public trust and making themselves “the new investment bankers.”
He cited last week’s £18m fine for Aviva Investors, the fund management division of giant insurer Aviva, as one cause for concern. Traders were found to have manipulated deals to boost their fees at the expense of customers.
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