In its response to the FSA’s discussion paper on consumer responsibility, the Panel says the FSA should focus on getting the industry to deliver products and services that are fit for purpose and genuinely designed to serve consumer needs.
The FSCP argues that the complexity of many financial products and the difficulty of finding an acceptable way to describe risk means that most consumers are ill-equipped to judge how a product will perform in future, and whether it meets their needs.
It says “by raising the flawed concept of consumer responsibility, and placing unrealistic expectations on consumers, the Panel fears that the FSA risks giving firms an excuse to evade responsibility for serving consumers well”.
FSCP acting chairman Adam Phillips says: “The FSA’s concentration on ‘consumer responsibility’ is unrealistic and unhelpful in discussions about how to create an effective and efficient retail market that delivers real benefit to the consumer, the industry and to society. The regulator should focus its attention on the firms it authorises, not the consumers it is set up to protect.”