RBS follows rivals in recruiting ex-regulator as compliance chief Royal Bank of Scotland has become the latest UK bank to appoint a former senior regulator as compliance chief to help it improve its conduct, in the wake of regulatory scandals that have rocked the country's banking sector. The appointment of Jon Pain, the former number two at the Financial Services Authority, as head of RBS's compliance and regulatory affairs comes after Mr Pain's former boss at the FSA, Hector Sants, was hired by Barclays early this year to fulfil a similar role. Lloyds Banking Group this month named the Irish banking regulator, Matthew Elderfield, as its compliance chief. RBS and Barclays were both fined record amounts for their involvement in the Libor rate-rigging scandal. Lloyds, whose worst transgressions have been in the mis-selling of personal protection insurance, is among several banks still being investigated over Libor. The moves from regulatory sphere into industry have tended to be more common in the US, where regulatory officials tend to change when government administrations change. In some cases, however, there has been criticism of such "revolving-door" moves. Mr Pain's appointment to RBS is the latest in a series of senior management change at the part-nationalised bank, as Stephen Hester, chief executive, prepares to move on from what he has called the process of "defusing the time-bomb" in the bank's balance sheet and readies the group for the next stage of its turnround. "The creation of this position sends a clear message about how we want to do business - serving customers well, completing our return to a safe and conservative risk profile, and generating sustainable returns for shareholders," Mr Hester said. Mr Pain, 55, will sit on the executive committee and report directly to Mr Hester. He joins RBS from KPMG where he has spent the past two years working as a regulatory affairs adviser across the firm's financial services practice. Before that he was head of supervision at the FSA for three years. But his career up to 2007 was in banking. He spent more than 30 years at various parts of the Lloyds group. The RBS role is a new one created, as at other banks, to signal the seriousness with which conduct risk is being taken. It also brings together two separate departments - compliance and regulatory affairs - in recognition of the need to harmonise the bank's dealings with regulators around the world. The current head of compliance, Andrew Robinson, who leads a team of about 1200 staff, is expected to remain in his role, though the way in which compliance and regulation are managed is likely to be restructured. At Barclays, Mr Sants has set about a wholesale restructuring of the global reporting lines in compliance, in the belief that there needs to be a single approach, set at a senior level, to the issue rather than the previous set-up of multiple segregated units. Mr Pain, who is set to start his new job in mid-August, will have a full in-tray. Although RBS's main Libor settlement was reached at the end of last year, there are still other related legal exposures outstanding, plus affairs relating to the mis-selling of PPI and interest rate swaps.