In-house solicitor fined for non-financial misconduct: implications for the financial services sector

 The Solicitors Regulatory Authority has fined a former BNP Paribas in-house solicitor for using offensive and inappropriate language in the workplace – will the FCA take a similar approach when enforcing non-financial misconduct?  

The Solicitors Disciplinary Tribunal has recently fined Leo Foster, a former inhouse senior solicitor at BNP Paribas, £15,000 and ordered him to pay £16,000 in costs. At the time of the allegations, he was a solicitor at BNP Paribas and Head of the London Debt and Equity Markets team. Foster admitted to creating and using ‘unprofessional’ and ‘offensive’ nicknames for colleagues and using ‘inappropriate language in the workplace’. Such names included “Mad Paul”, “The Twittering Fool” and “Jabba the Hut”. He also swore on a number of occasions in emails and questioned whether a colleague was autistic. His conduct was alleged to be in breach of Principles 2, 5 and 6 of the Solicitors Regulatory Authority Principles (Principles). Principle 2 requires solicitors to uphold public trust and confidence, Principle 5 requires solicitors to act with integrity and Principle 6 requires solicitors to encourage equality, diversity and inclusion.  

Foster admitted the allegations but in mitigation cited the difficulties of the pandemic and stress in his defence and expressed his remorse. The tribunal acknowledged that ‘he had found the changes to the working environment difficult, but he had failed to handle this with the standards expected of a solicitor of his experience and standing’.  

What does this mean for firms regulated by the FCA?  

The regulatory focus on non-financial misconduct, such as bullying, harassment, and discriminatory behaviour, is increasingly mirrored in the financial services sector. To date, the FCA has tended not to take enforcement action against individuals it regulates for this type of behaviour – leaving it to individual firms to take disciplinary action. For example, earlier this year, the FCA fined and banned Crispin Odey from the UK financial services industry for acting with a lack of integrity. The FCA’s grounds to act were based on a failure to follow proper procedures, rather than the allegations of sexual misconduct against Odey. However, the FCA is currently consulting over how firms should deal with instances of non-financial misconduct and is proposing to tighten the Conduct Rules and requirements in respect of fit and proper standards. Under the proposals, non-financial misconduct will potentially be a breach of these standards, and may lead to more instances of enforcement action by the FCA along the lines of that taken by the SRA.  

The final rules are expected to be published later this year. In the meantime, the FCA is encouraging an increased effort from firms to prevent such behaviour. Earlier this year, Emily Shepperd, Chief Operating Officer of the FCA delivered a speech titled ‘Culture is Contagious’, reflecting on the importance of culture in meeting the FCA’s objectives as ‘it is culture that drives conduct’. This followed a survey conducted by the FCA last year, which found the reported number of non-financial misconduct incidents had increased between 2021 and 2024, with bullying and harassment being the most common types of misconduct reported.  

What can firms do to prepare?  

As regulatory expectations increase, the demand for firms to increase transparency and accountability will only become greater. Firms should begin to review and strengthen their internal policies, training, and reporting mechanisms to align with the FCA’s increased focus on improving culture and expected regulatory rules to complement this.