Newcastle University

Aims

This course seeks to :
-Introduce and explain the legal and regulatory environment in which financial institutions operate.
-Explain the legal and enforcement powers of financial regulators

Original Summary:
Why do banks and financial institutions have to employ such extensive compliance departments? What do banking lawyers do? Where does legal risk arise in financial markets and transactions?

This course will be of use for those who are interested in working within the banking and financial sectors who may not themselves be from a legal back ground or have any legal training yet whose working environment is shaped and influences by both domestic and international law. You may well acquire responsibility within your employer for the implementation of and monitoring of compliance with internationally agreed legal and regulatory standards applicable throughout the banking sector and enforced through force of law by financial regulators worldwide.

Or, if you go into a more active front office role within finance you will need to be aware of your legal and regulatory obligations which exist to protect your customers, counterparties, and to ensure the prudential soundness of financial institutions as well as the integrity of the financial markets themselves.

As well as making reference to and explaining the genesis of the international standards reference will be made to their implementation, interpretation and enforcement within the legal and regulatory systems of the EU and the UK.

Outline Of Syllabus

• Policy Justifications for Bank Regulation and Supervision – Common stated objectives of financial regulation.

• Brief Introduction to Techniques and Sources of Financial Regulatory Law

• Standard-setting work of the Basel Committee on Banking Supervision and other relevant international standard setters in international financial markets      
• Basel Core Principles for Effective Banking Supervision

• Legal and Regulatory Techniques commonly employed in bank regulation and supervision – determining scope of regulatory law, authorisation, approval and licensing mechanisms, prudential regulation, conduct of business regulation, regulation of marketing and advertising, investor compensation.
• Legal and Regulatory Techniques commonly employed in Bank Regulation and Supervision – The importance of implementation and enforcement.
Examples of regulatory enforcement action being taken against financial institutions and others – role of judges and Courts in judicial oversight of use of regulatory enforcement powers.

• Legal protection for financial supervisors

Teaching Rationale And Relationship

The lectures will be largely explanatory of how to access and interpret the sources of law and regulation pertinent to banking and finance.

During the interactive student led seminars students will apply their legal knowledge to real commercial scenarios.

Assessment Rationale And Relationship

The unseen written examination will assess students’ awareness, understanding and knowledge of legal and regulatory standards rather than test memory alone.