The term refers to rogue employees who move between firms without ever facing consequences for harassment, bullying or worse.

Under the rules, nearly 40,000 companies will be expected to report any serious cases of non-financial misconduct to the regulator. Firms will also be required to pass on reports of bad behaviour, including sexual harassment, racism, violence and intimidation, to an employee’s prospective future employer.

From the start of September, the crackdown will extend to a wider group of City investment firms and brokers beyond the banking industry.

Experts say that thousands of firms are racing to train their staff and wrap up any internal investigations before the rules go live.

Jill Lorimer, a partner at the law firm Kingsley Napley who focuses on financial regulation, told The Guardian: “We are aware of firms brushing up their policies and procedures in this area and ensuring training has been thoroughly refreshed and completed. Firms dealing with allegations against their people now may want to ensure that these processes are wrapped up before the new regime takes effect. The FCA will no doubt be looking for cases in this area to show it is willing to flex its muscles.

“The City should take these changes very seriously indeed, as no firm will want to be the target of high-profile regulatory attention. The new rules will apply to any company bound by the FCA’s senior managers and certification regime, which holds top bosses accountable for wrongdoing.”