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Chris Cummings says industry must not reject new regulation

City UK chief executive Chris Cummings has warned the financial services industry not to push back against additional regulation to avoid further damaging the sector’s reputation with consumers.

Speaking at a fringe event at the Labour party conference in Liverpool this week, the former Aifa director general said the industry must be careful when lobbying for changes in regulation to avoid being seen as anti-regulation. He said the industry must instead work towards good regulation which benefits firms and consumers.

Cummings said: “Too often, financial services is portrayed as the bride dragged to the altar and that is something we have to take a long hard look at ourselves over. We have lost our reputation and part of the solution to that from the public’s perspective is more regulation, so if financial services is seen to be anti-regulation, then our period in the wilderness will just continue for much longer.”

Cummings admits that the pursuit of greater profit and a failure to engage with people on a local level led to the industry “drifting away” from customers.

He said: “There was a sense that centralisation was the way to achieve greater profit. We reverted to conversations along the lines of ’we pay £53bn in tax, we create a million jobs and so surely that makes us a great national asset’. What the public wanted to hear about was how many jobs we were creating locally. As a sector, we drifted away from our public.”


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There are 3 comments at the moment, we would love to hear your opinion too.

  1. We are not hostile to regulation, never have been. However we do speak our minds when regulation fails to deliver what our clients need which is a safe and reasobaly priced method of obtaining INDEPENDENT (sorry I shouted) advice on a wide range of services whether they be state benefits, protection, pensions or the ‘new’ order of wealth management.

    Has regulation met any of these needs to date?

  2. I fear the headline and future responses may see Chris Cummings comments out of context.
    He appears to be speaking about big business FS and regulation and NOT IFA regulation.
    IFAs (on the whole) have remained close to their clients and big business has distanced itself.
    IFAs have been over regulated and the product providers UNDER. That is the perception of our clients (as IFAs we hear it all the time)

  3. Calling for:-

    1. some moderation to the never ending string of new initiatives (many of which are not properly thought through),

    2. the protection of English Law in the form of the longstop (which isn’t denied to any other industry) and

    3. an end to regulation by hindsight (a mechanism by which the FSA offloads onto us responsibility for its own failings),

    4. Consultations which are more than exercises in mere tokenism (such as publishing feedback for all to see and to debate in open forum) and

    5. accountability of the regulator itself (not least on its colossal yearly budget ~ does anyone believe that the FSA spends its £500m prudently?) and

    6. that it should observe the Statutory Code of Practice For Regulators (which it totally ignores)

    are not symptoms of a fundamentally anti-regulation mindset. Rather, they’re calls for fair treatment instead of what is widely perceived to be an often self-serving agenda set by an unelected quango without regard for the reasonable rights of those whose lives and livelihoods are increasingly placed under intolerable pressure.

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