Providers should be held responsible for the development of flawed products, says former FSA deputy chair Dame Deirdre Hutton.
Hutton was appointed to the FSA board when the regulator was set up in 1997 and stepped down as deputy chairman in 2007. Speaking as part of a panel session at the FSA’s conference on the Financial Conduct Authority, Hutton said: “I believe that too often the liability issues in financial services are solely seen as between the consumer purchaser and the IFA seller. I think the liability should go back up the chain to the people who manufacture the products. If an IFA is given a duff product to sell then I think the manufacturers should bear some liability.”
Hutton’s comments followed a question from a conference delegate who raised the issue of consumer responsibility.
The delegate said: “I would like to see customers taking responsibility. There seems to be a lot of discussion about the protection of customers, but frankly dealing with a customer who is refusing to take responsibility for their actions is extremely difficult.”
But Financial Services Consumer Panel vice-chair Kay Blair dismissed the argument that consumers should assume some responsibility for the products they are buying.
She said: “The financial services industry is very keen to heap additional and often hidden risk on to consumers through hidden charges and now it wants to heap additional responsibilities on them.
“We live in an age where we have a very complex and sophisticated financial services industry that can run rings around consumers, so I would certainly reject additional obligations being put on consumers.”