New watchdog: we don’t care if London is competitive or not

THE NEW regulator charged with protecting consumers should not have to take into account the competitiveness of the City when making decisions, its incoming chief Martin Wheatley said yesterday.

Appearing before the influential Treasury Select Committee, Wheatley, who will run the Financial Conduct Authority (FCA) when it is created next year, said that the body should be able to ban financial products pre-emptively without regard for the City’s attractiveness as a financial centre.

“People are attracted to a well regulated structure – safe secure transparent markets that they can have confidence in,” he argued.

“All of that enhances competitiveness. But that’s quite different to having a specific objective that would be used to argue against things that would otherwise be sensible measures.”

He added that if the FCA were to not take action due to fears about harming the business environment of London, “it would be a very strange outcome”.

The FCA will have sweeping new powers to intervene to protect consumers before firms’ actions have yet been proven to be problematic, on the basis that they could be likely to become so.