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Northern Rock CFO steps down following FSA allegations

Publicly owned bank says chief financial officer David Jones has left the company with immediate eff

'This enables Jones to focus on an ongoing FSA investigation into matters relating to a period before the company entered public ownership,' the banking group said in a brief statement. The Financial Services Authority (FSA) widened its investigation into attempts to hide mortgage arrears at the banking group on Monday, saying it wanted to investigate Jones' knowledge of incorrect statements signed off between 2004 and 2008.

The financial services watchdog fined two former Northern Rock executives last week, former deputy chief executive David Baker and former managing credit director Richard Barclay, and banned them from working in the financial services sector. Northern Rock said that Hugh Graham, head of the company's Treasury operation, will take over as interim chief financial officer subject to FSA approval.

Jones became finance director in 2007 and was later chief finance officer of Northern Rock Asset Management. Asset Management said today the group is not subject to any sanction from the FSA as a result of the latest development in the investigation.