The Treasury select committee is calling on trade bodies to be more vocal about problems they see with regulation and to justify any proposed alternatives in terms of benefits to consumers.
In its report into the accountability of the Financial Conduct Authority, the TSC says industry has complained “a great deal” about current regulatory practice but has often not backed up concerns or suggested alternatives.”
It adds that the establishment of a new regulator provides an opportunity for improved dialogue. “It should be seized,” the report says.
When Aifa appeared before the TSC in 2010 to discuss the RDR, committee chair Andrew Tyrie accused Aifa director Robert Sinclair of “talking in code” and implored him to tell the MPs “what he really thinks”.
The report also calls for the regulator and firms to be given a duty to a “high level of engagement and exchange of information” to increase the FCA’s accountability to industry.
Aifa director Robert Sinclair says: “If you are too outspoken or too far away from where the FSA thinks is right, your ability to influence them is negligible.”