Regulatory fines moved into legal risk definition
Basel -- According to a source close to the Basel Committee on Banking Supervision, the concept of legal risk will be explicitly broadened in the final version of the Basel II document, due out at the end of June – to include fines, penalties and punitive damages that are a result of regulatory actions.
Originally, this was not stated explicitly by the regulators drafting the Basel II document, although the source says that they had always assumed these items would fall under the umbrella of legal risk.
Indeed, some operational risk managers view legal risk as purely the result of legal problems, with a specific focus on counterparty risk. For example, law firm Clifford Chance defined legal risk in a seminar earlier this year as "the risk that one is unable to enforce rights against, or rely on
Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.
To access these options, along with all other subscription benefits, please contact info@risk.net or view our subscription options here: http://subscriptions.risk.net/subscribe
You are currently unable to print this content. Please contact info@risk.net to find out more.
You are currently unable to copy this content. Please contact info@risk.net to find out more.
Copyright Infopro Digital Limited. All rights reserved.
As outlined in our terms and conditions, https://www.infopro-digital.com/terms-and-conditions/subscriptions/ (point 2.4), printing is limited to a single copy.
If you would like to purchase additional rights please email info@risk.net
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. As outlined in our terms and conditions, https://www.infopro-digital.com/terms-and-conditions/subscriptions/ (clause 2.4), an Authorised User may only make one copy of the materials for their own personal use. You must also comply with the restrictions in clause 2.5.
If you would like to purchase additional rights please email info@risk.net
More on Risk management
Independent audits drive compliance in FRTB data solutions
The EU and the Basel Committee have introduced strict audit standards for data vendors to uphold the FRTB rules. With deadlines approaching, audited solutions are critical for banks to ensure compliance, minimise NMRFs and reduce capital requirements
New CME guidance to drive tighter margin call management
Clearing house rule clarified to limit the use of grace periods to cases of admin/operational errors only
Too ’Berg to fail? What October’s Instant Bloomberg outage means for the industry
The ubiquitous communications platform is vital for traders around the globe, especially in fixed income and exotic derivatives. When it fails, the disruption can be great
SEC leadership change puts Treasuries mandate under scrutiny
FICC clearing models approved, but critics think delay could revive prospects of done-away trading
Markets Technology Awards 2025: Untangling the knots
Vendors jockeying for position in this year’s MTAs, as banks and regulators take aim at counterparty blind spots
Risk Awards 2025: The winners
UBS claims top derivatives prize, lifetime award for Don Wilson, JP Morgan wins rates and credit
An AI-first approach to model risk management
Firms must define their AI risk appetite before trying to manage or model it, says Christophe Rougeaux
BofA sets its sights on US synthetic risk transfer market
New trading initiative has already notched at least three transactions
