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&#39FSA acting as unelected Government,&#39 says Flight

The FSA is acting as an “unelected Government” and is not accountable to the industry it represents, claims Conservative financial services spokesman Howard Flight.

In an article appearing in the November issue of CII&#39s publication The Journal, Tory Shadow econ omic secretary Flight, who was co-founder of fund man ager Guinness Flight, writes that the regulator is not accountable to the industry and must be reviewed regularly to keep it in check.

Flight believes that there is a strong case to split Howard Davies current role as chairman into separate positions of non-executive chairman and chief executive.

He calls for the non-executive directors to be given full remit to scrutinise the activities of the board.

Flight also expresses concern over the FSA&#39s abil ity to cope with its wide-ranging remit, pointing to its reluctance to take on the regulation of mortgage advice and general insurance regulation.

He says: “The FSA constitutes an unelected Gov ernment for the biggest single sector of the UK economy – financial services – where there is an insufficient antidote to the absence of representative accountability.”

This week, the ABI&#39s investment committee iss ued a report calling for leading FTSE companies to split the roles of chief executive and chairman. The ABI says the FSA should follow suit.

An ABI spokesman says: “It is a point that we made when the legislation was a bill. As a matter of good governance, there is a case to be made for the separation of the roles of FSA chairman and chief executive.”

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