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FSA Grants Amnesty for Disclosure Rules

Global Glimpses | January 12, 2009

U.K. regulator the Financial Services Authority has given company directors a brief amnesty to comply with its disclosure rules on shares used as loan security, after admitting the rules had caused “uncertainty.”

In a statement issued to clarify its position, the FSA said a director who wants to use company shares as security has to get approval from the company beforehand. If it gives approval, the company should then disclose the transaction to the market.

The regulator’s action was prompted by the resignation in December of David Ross from the board of listed company Carphone Warehouse. Ross—a cofounder of the business and near-20 percent shareholder—stood down when the company revealed that he had used 136.4m of his shares in the company as security against personal...

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