THE GOVERNMENT’S new consumer watchdog for financial services must break away from the “bureaucratic” and “box-ticking culture” of the Financial Services Authority (FSA), according to a stark warning this morning from Andrew Tyrie MP.
Tyrie, chairman of the Treasury Select Committee, has blasted the past failures of the FSA to protect consumers -- and fears the new Financial Conduct Authority (FCA) could be set to repeat the mistakes.
“We need a fresh approach to regulation,” Tyrie said today, launching the Treasury Committee’s report into the FCA. “If we are not careful, the FCA will become the poor relation among the new institutions.”
Widespread mis-selling of payment protection insurance (PPI) by banks, on top of mis-sold endowment mortgages, are “just two examples” of the “spectacular regulatory failures” of the FSA, Tyrie said.
“Too often we’ve heard that the FSA is aloof and unapproachable and that, in any case, firms are nervous about approaching them – we must break with that culture,” Tyrie explained.
Yet the FCA’s “primary objective” should be the promotion of “effective competition” in financial services, the report states, calling on the government to enforce this remit with fresh legislation.