Ex-RBS executive agrees to employment ban

May 18, 2010, 6:21 a.m. EDT

Ex-RBS executive agrees to employment ban

Johnny Cameron settles investigation, won't be fined

By Simon Kennedy, MarketWatch

LONDON (MarketWatch) -- The Financial Services Authority, adding another scalp to its collection, announced Tuesday that the former head of Royal Bank of Scotland's investment-banking arm has agreed to a ban on working in financial services.

Johnny Cameron has said he won't perform any "significant influence" function and won't take full-time employment in the financial industry. In turn, the FSA said it won't take disciplinary action against Cameron, who therefore will not be fined.

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In a brief statement, the regulator said it had been investigating systems and controls that in place at the global banking and markets unit of RBS (UK:RBS 45.20, -2.12, -4.48%) (RBS 13.21, +0.01, +0.08%) at the time that Cameron was in charge.

The division was largely responsible for massive losses that led to a bailout worth around 45.5 billion pounds ($67.2 billion) and ultimately left the government owning 84% of RBS.

The FSA's announcement came roughly a month after the regulator fined two former executives at nationalized lender Northern Rock a total of £644,000 for misleading investors and analysts over the state of the bank's mortgage arrears. See full story on the Northern Rock executives.

That case was followed swiftly by the resignation of David Jones, who had served as chief financial officer of Northern Rock's "bad bank." over an ongoing investigation by the regulator. See full story on Jones' departure.

The FSA said Tuesday that it would have sought a ban against Cameron if he hadn't agreed to settle the investigation, but it made no mention of whether he would have faced a fine.

Terms of the settlement mean that Cameron can take part-time consultancy work in financial services industry provided it's not in a so-called "significant influence" role that would usually have required approval from the regulator.

Simon Kennedy is the City correspondent for MarketWatch in London.