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Cole seeks to limit super-complaints

The FSA says it would support giving consumer groups the right to trigger super-complaints but warns the power should not be given to industry bodies or private law firms.

In June, the Government ruled out giving consumer groups the power, which was proposed in consultation documents that informed the draft Financial Services Bill.

Giving evidence to the committee scrutinising the bill last week, FSA conduct of business unit interim managing director Margaret Cole said: “A super-complaint mechanism for consumer groups is fine, it is a good idea. What I would be concerned about is if it extends to parties who I think should not have the benefit of such a mechanism, in particular, industry groups and private law firms.”

Cole said industry groups could use the power to force the Financial Ombudsman Service to stop considering individual cases where products have caused consumer detriment.

She said: “I have heard a lot of noise that industry groups think it should apply to them. We would have a lot to say if there was a move to extend it to them.”

In its submission to the Treasury select committee’s inquiry into the Financial Conduct Authority, Consumer Focus called for the regulator to have a statutory duty to investigate and respond to super-complaints from designated consumer bodies.

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There is one comment at the moment, we would love to hear your opinion too.

  1. What about super-complaints against the regulator? I ask this question not just as an opportunity to have another dig at the FSA, but because of what is set out in the very first section of the Statutory Code Of Practice For Regulators:-

    1.1 Effective and well-targeted regulation is essential in promoting fairness and protection from harm. However, the Government believes that, in achieving these and other legitimate objectives, regulation and its enforcement should be proportionate and flexible enough to allow or even encourage economic progress.

    1.2 This Code supports the Government’s better regulation agenda and is based on the recommendations in the Hampton Report. Its purpose is to promote efficient and effective approaches to regulatory inspection and enforcement which improve regulatory outcomes without imposing unnecessary burdens on business, the Third Sector and other regulated entities.

    1.3 The Code stresses the need for regulators to adopt a positive and proactive approach towards ensuring compliance by:

    • helping and encouraging regulated entities to understand and meet regulatory requirements more easily; and

    • responding proportionately to regulatory breaches.

    1.4 The Code supports regulators’ responsibility to deliver desirable regulatory outcomes. This includes having effective policies to deal proportionately with criminal behaviour which would have a damaging effect on legitimate businesses and desirable regulatory
    outcomes.

    Compliance, it seems, is most definitely a one-way street. Do as we say, not as we do.

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