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Aifa warns FCA not to ‘take scalps’ to prove its strength

Aifa has warned the Financial Conduct Authority must not “take scalps to prove it is tough”, after FCA chief executive designate Martin Wheatley claimed the new regulator will “shoot first and ask questions later”.

Speaking at an Association of British Insurers conference on conduct regulation in London this week, Wheatley set out how the FCA will differ from the FSA.

He said: “The key difference between the future and now, and forgive me for being scary in my use of analogy, is we are being given the power to shoot first and ask questions later.

“Today’s approach is we find a problem and do lots of analysis, we publish a set of draft rules and consult with the industry, then we are told we have got it wrong, and we publish another set of rules. A year later we get to the point where we think we got it right first time. We have got to reverse that process.”

Aifa policy director Chris Hannant says the FCA needs to act fast to minimise consumer detriment, but he says: “It would concern me if the FCA’s mentality was to take some scalps just to prove it is tough. That is not the way the FCA should be regulating.”

Page Russell director Tim Page says: “The key worry is proportionality. It is necessary to go in all guns blazing against banks, but from the point of view of smaller businesses it is an altogether more scary prospect. His comments suggest a quicker route from supervision to enforcement.”

Equilibrium Asset Management investment manager Mike Deverell says: “The trouble is language like this does not help counter the idea of a “them and us” culture. The regulator should be working to safeguard the interests of the industry as a whole, not just consumers.”

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Comments

There are 4 comments at the moment, we would love to hear your opinion too.

  1. Derek Bradley ceo Panacea 20th September 2012 at 10:05 am

    William Joyce – nicknamed Lord Haw-Haw by the ‘Daily Express’ was the voice of the Reich Ministry of Public Enlightenment and Propaganda who started off his broadcasts of news to the British public from a Hamburg radio station with the introduction “Germany calling, Germany calling”.

    Joyce’s broadcasts often involved stories designed to unnerve the British public. On one occasion, Joyce asked the British public to question the Admiralty over the aircraft carrier “Ark Royal”. In fact, nothing had happened to the “Ark Royal” but the seeds of doubt had been sown.

    So, fast forward to 2012 and the messages seem to sound like “FSA/FCA calling, FSA/FCA calling” previously telling their audience to be “very afraid”, and now, we will “shoot first and ask questions later” in their ongoing attempts to unnerve the financial services industry with ever more cunning regulatory ideas and implementation methods!

    It seems a little insensitive shall we say?

    A regulator should be guarded, proportionate and reasoned in it’s communication, this type of phrase it is not really appropriate, especially coming from an organisation that has it would seem ‘form’ for having no accountability to anybody for anything, ever.

  2. Martin Wheatley “AIF…who?”

  3. FCA must be wetting themselves

  4. “….we publish a set of draft rules and consult with the industry, then we are told we have got it wrong, and we publish another set of rules. A year later we get to the point where we think we got it right first time. We have got to reverse that process.”

    So what does this imply? No more consultations, because “we” think “we” always get it right first time? History suggests rather the opposite.

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