Mission to Protect Consumers

FCA Mission to Protect Consumers.

The Financial Conduct Authority (FCA) has today launched a consultation on its Mission, which is designed to provide a guiding set of principles around the strategic choices the FCA makes. It will inform the FCA’s strategy and day-to-day work over the coming years.

Key themes that the FCA will be consulting on include:

• Protecting consumers – in an environment where consumers are increasingly expected to take responsibility for their own financial decisions, what is the right level of consumer protection; and how does the FCA balance the responsibilities of firms and consumers?
• Vulnerable consumers – should the FCA prioritise the protection of vulnerable consumers and if so how?
• Delivering consumer redress – what should the role of the FCA be in redress schemes, for example in dealing with activity outside the FCA’s remit?
• When the FCA intervenes – how the FCA identifies harm and how it decides which approach to take to address it; and how can the FCA be clearer for firms, consumers and stakeholders on what it is doing and why?
• The scope of regulation – explaining the remit the FCA has for taking action and the circumstances in which the FCA may intervene with regard to unregulated activities;
• The interaction between regulation and public policy – explaining this interaction using examples including access to financial services and price discrimination;
• Competition, supervision and enforcement – providing clarity and seeking feedback on the FCA’s current approach to using its different regulatory powers and tools;
• FCA Handbook – seeking suggestions on a proposed review of the FCA Handbook which sets out the rules for firms.

Comment

The FCA already has a statutory duty i.e. it is law under the Financial Services and Markets Act to protect consumers.  We therefore, suggest this is a smokescreen to keep the Treasury Select Committee happy.  Its predecessor, the FSA failed totally by not supervising banking groups and mortgage lenders adequately resulting the collapse of many banks and the credit crunch of the last decade.  As a result, the FSA was split into two regulators the Financial Conduct Authority (FCA) and the remit for ensuring financial strength of banks passed back to the Bank of England via the newly created Prudential Regulation Authority (PRA).  These two regulators “rebranded” are the old FSA in all but name.  

Whilst it is a good thing for the regulator to “turn the microscope on itself”, in the combined 50 years that two directors have been involved in the financial services industry, not once has any regulator contacted either of them for feedback.