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FCA chair attacks ‘vested interests’ opposing new regulatory approach

John Griffith-Jones
FCA chairman John Griffith-Jones

Financial Conduct Authority chairman John Griffith-Jones has hit out at powerful “vested interests” for strongly opposing its new approach to regulation.

Speaking at a Chartered Institute of Securities and Investment conference today, Griffith-Jones said firms had been quick to “reach for their lawyers” to oppose FCA decisions in the regulator’s first 100 days.

Last week, former Bank of England governor Lord Mervyn King sounded the alarm over banks aggressively lobbying Government on capital requirements, saying they had “crossed the line”.

Griffith-Jones said the opposition is a product of a new regulatory approach based on principles and judgement, rather than rules, but pledged the regulator would be predictable, consistent and clear in its decisions.

He said: “The earlier we have to intervene the greater possibility we have to get it wrong and the more contentious it is likely to be.

“Where the existence of a problem has not been established beyond all reasonable doubt we are finding ourselves bumping into very strong vested interests that are deeply entrenched and eager to reach for their lawyer if necessary.

“If you want proactive and preventative regulation there has to be some give and take on both sides rather than digging in at the first sign of disagreement over an outcome.”

Griffith-Jones also said the industry should work on closing the financial advice gap, tackling fund charges and ending the use of small print in contracts.

He also warned that most future regulation would come from Europe and it was the responsibility of the Treasury to get a good deal for the UK, not the FCA.

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Comments

There are 15 comments at the moment, we would love to hear your opinion too.

  1. ‘Griffith-Jones also said the industry should work on closing the financial advice gap, tackling fund charges and ending the use of small print in contracts.’

    …..Well you’ve made a cracking start with that!

  2. My understanding is that regulation from the EU is already in place the FSA stated that it had finished discussion and what EU wants parliament agrees because it is the law ! Give and take is absolutely right, but we see with recent HMRC issues on QROPs that joined up thinking is a long way off.

  3. He said: “The earlier we have to intervene the greater possibility we have to get it wrong and the more contentious it is likely to be.

    “Where the existence of a problem has not been established beyond all reasonable doubt we are finding ourselves bumping into very strong vested interests that are deeply entrenched and eager to reach for their lawyer if necessary”.

    So you would rather sit back and let it happen rather than intervene, a bit like you did with HBOS whilst at KPMG.

    What is the point in this regulator other than vested interests of those who are employed by it?!

  4. Simon Webster 3rd July 2013 at 5:20 pm

    …tackling fund charges…

    Interesting idea this. Who do they think is making all the money? It’s not generally advisers. It’s not the product providers and it’s not the platforms -most of whom are loss making.

    Some of the fund managers perhaps?

    The trouble with swinging statements is that it is not altogether clear who the target is.

    I also thought the FCA was not going to intervene on quantum save for a decency review -s o are they now going to start arguing about 30 – 50 bps.

    People don’t have to pay it is they don’t want to!

  5. Griffith-Jones also said the industry should work on closing the financial advice gap
    The industry did not cause it the FSA did.
    Not our problem Mr Griffith, thanks to RDR we only deal with HNW. The rest can go to MAS.

  6. We’ve just sacked a group pension scheme today as the company can’t pay for professional advice and the staff members don’t see why they should foot the bill.

    We can’t give these services for nothing and had asked for £50 per case to cover the admin and time costs.

    Maybe they need to realise that we’re not all overcharging and trying to abuse the system.

    I’m not in a position to lobby the government and I have 5 people in my business.

    You’re regulating the wrong people out of the industry!

  7. This is a bit rich coming from Griffith-Jones isn’t it ?

    It was not that long ago that FSDA/FCA staff were found guilty of intimidation and bulling !! and were those responsible sacked or brought to book in any way ? no the FCA bosses ruled they had not done anything wrong. So are you surprised that when you come knocking that companies have there solicitors or lawyers to hand.

    You forget we have been dictated to by an iron fist for a long time (be afraid springs to mind) so we are getting used to your bullying.

    Maybe its the FCA who need to start giving us a bit of respect ? rather than having to hear quotes from your staff like “putting us all in a barrel and shooting us one by one” or shoot first ask questions later” or my favourite from a FCA staff member at a recent roadshow ” it you don’t do as we ask or say I will gladly put on my hob nail boots”

    “Zombie Regulation” !!!!

  8. Once again those regulating us throw in fund charges to justify their lack of real action.

    It’s like continually blaming those greedy bankers for all of the countries woes.

  9. People understand commission eg this will cost you 3% of the total contribution you are going to pay for this service. When people see pounds shillings and pence they gawk at it. It is the FCA who got it wrong and cant admit they got it wrong.

  10. To lighten the tone here, can anyone remember Steptoe and son on the Beeb? Not sure why this article brought back that memory.

  11. @ D H
    That is truly shocking not to mention totally unprofessional
    I bet that particular guy was a real smug little prat who thought he was a gift to regulation.
    As employers we would never dream of speaking to our workforce in that manner.
    And the regulators wonder why we have zero respect for them.

  12. Dick Sprinkler 4th July 2013 at 11:08 am

    How funny George I remember it well same thing struck me too !

  13. RegulatorSaurusRex 4th July 2013 at 2:49 pm

    “new approach”?

    I am extinct but I was SIB, then FSA and now FCA, I am the same fossilised pile of bones, same company name, new Chairman but same old same old. With each reincarnation and reinvention following increasingly scary failures and crises has come a more threatening regime dishing out “unfair justice”.

    What has regulation done for consumers?

  14. Griffith-Jones – “the industry should work on closing the financial advice gap, tackling fund charges and ending the use of small print in contracts”

    I almost spit my tea out reading this comment! After 25 years as an IFA and having an excellent relationship with my clients the regulator have caused absolute havoc with the industry and caused more client confusion that any bureaucrat could have dreamt up. Instead the average client is either scared of taking advice for the first time or going the DIY route – execution only – and paying over the odds in the process. This current market is not the industries fault as the industry only works with the rules/guidelines we have. Griffiths-jones needs to look in his own back yard for the solutions to fix the mess and stop the blame game. Its a cheap shot – but not for me as an IFA or my clients

  15. Nice one George.

    ‘arold!!

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