The Which? Future of Banking Commission has called for the complete removal of commission for front-line bank staff and enforcement action against senior management in firms putting excessive sales pressure on workers.
The cross-party commission delivered its findings to the Government this week. The aim is to “put ordinary people and society at the heart of a reformed banking system”.
It recommends that remuneration for front-line and branch staff should not be linked to sales, with no commission or bonuses received for selling products.
The commission has urged the FSA to take enforcement action against senior management for any remuneration structures or sales targets that contribute to misselling by putting excessive pressure on front-line staff.
It calls for the introduction of a rule that bans banks that advice clients from trading any form of securities, saying this would address conflicts of interest within investment banks.
The commission was developed by Which? following a proposal from former Treasury select committee chairman John McFall, who wanted to ensure that the public had an opportunity to voice their opinions about the future of banking.
It was chaired by Conservative MP David Davis and members were McFall, Business Secretary Vince Cable and Which? chief executive Peter Vicary-Smith, former Schroders group managing director Philip Augar, Clare Spottiswoode, Hermes Focus Asset Management chairman David Pitt-Watson and economist Roger Bootle.
Evolve Financial Planning director Jason Witcombe says reducing sales pressure on front-line staff will help customers get a better service.
He says: “This is not the answer to making sure a banking crisis does not happen again because I think it is a totally separate issue but I completely agree that this is a sensible move to encourage banks to treat their customers fairly.”