A COMBATIVE litigator known for her uncompromising style was named yesterday as the new chief investigator and prosecutor of City wrongdoers.

Margaret Cole, currently the commercial disputes partner in the London office of US law firm White & Case, will join the Financial Services Authority as director of enforcement, the head of a 200-strong team.

Ms Cole, 43, is to replace the acting head, David Mayhew, in July. Mr Mayhew stepped in temporarily after Andrew Procter quit suddenly in January for a compliance job at Deutsche Bank.

City lawyers, while applauding Ms Cole’s tenacity and litigation skills, said that the appointment might intensify the increasingly adversarial approach of the FSA.

David Gold, lead partner at Herbert Smith, said: “I found her to be a formidable litigator. If she brings that style to the FSA, I’d expect their stance to become even tougher. She’s no pussycat.”

John Fordham, head of commercial litigation at Stephenson Harwood, where Ms Cole was a partner till 1995, said: “She’s got masses of experience of dealing with people in dispute situations, ranging from the biggest banks in the world to your lowly villain.”

Asked whether she would go aggressively after scalps, he said: “She’s fearless. She’ll pursue whatever she thinks it’s necessary to pursue.”

Ms Cole is expected to have to take a substantial pay cut. The new job was advertised with a base pay level of about £200,000 plus perks. At White & Case, the average profit per partner in London last year was $1 million (£520,000).

White & Case’s clients include almost every large City house, including Goldman Sachs, Morgan Stanley, Barclays Capital and Deutsche Bank.

Ms Cole has represented firms under investigation by the FSA, but both the FSA and White & Case declined to reveal which ones on the grounds of client confidentiality.

However, last year she represented Royal Bank of Canada over an Enron-related matter and in the 1990s she led actions to recover looted Maxwell company pension fund money.

When working on the liquidation of BCCI, the failed bank, in the early 1990s, she once negotiated through two successive nights with no sleep. “She’s a very tough cookie,” said one lawyer.

John Tiner, the FSA chief executive, said: “Margaret is one of the City’s most experienced and respected financial services litigators. I am delighted she has agreed to lead this important element of the FSA’s operations.”

Married with no children, she likes opera and riding and owns her own horse.

The FSA’s enforcement arm has come under fire recently for its failure to secure prosecutions in the split capital trust scandal and for its case against Legal & General, where it was criticised for deficiencies in its systems.

Times Recommends

• C&G axed - 1,660 jobs to be lost
• UK house prices rise 1.1% as buyers return
• Mixed reaction to US banks repaying bailouts