Tuesday, October 16, 2012

New UK market watchdog to spell out approach to industry

LONDON (Reuters) - Britain's new market watchdog will spell out on Tuesday how its sharper teeth to ban products and challenge business models should make the 26,000 firms it will supervise think twice about ripping off consumers again.

Martin Wheatley, the head of the Financial Conduct Authority being launched in early 2013, will tell a Thomson Reuters event at 9:00 a.m. British time how powers to take harmful products off the market would work in practice.

"We will make the intervention first and then we will carry out the consultation and the cost/benefit analysis," Wheatley told an industry event last week.

The new approach aims to draw a line under 20 years of mis-selling in Britain and make sure consumers are offered products that are suited to their needs.

The cost to banks of compensating people mis-sold loan protection insurance alone will top 10 billion pounds.

The FCA will take on the conduct, enforcement and consumer protection operations of the Financial Services Authority when the unitary supervisor is scrapped early next year.

The FSA's broader supervisory powers over banks and insurers will be handed to a new unit at the Bank.

This "twin peaks" set-up seeks to increase the intensity of supervision which was found wanting ahead of the financial crisis.

The dual regulatory approach has already been introduced on a "virtual" basis by splitting up the FSA staff into conduct and prudential units ahead of a formal switchover next year.

Wheatley is expected to say that many of the changes made by the FSA, in particular the "credit deterrence" policy of taking a harder line against insider dealing and market abuses, will continue under the FCA.

The FSA has been collecting record fines from financial firms, in particular Barclays for rigging the Libor interest rate.

The government has just announced that fines in excess of enforcement case costs will in future go to the treasury, a step which may make the watchdog pause before taking on complex cases that require many resource-intensive months to probe.

The financial industry will study the document Wheatley publishes on Tuesday to see how it will pursue three core aims of trustworthy markets, promoting effective competition and requiring firms to put consumers at the heart of their business.

The industry is already alarmed the FCA can tell the public far earlier if it is taking action against a financial firm.

(Reporting by Huw Jones; Editing by David Cowell)

Source: http://news.yahoo.com/uk-market-watchdog-spell-approach-industry-230711576--finance.html

mt rainier national park rose parade mount rainier national park drop dead gorgeous ticket city bowl 2011 nfl playoff schedule cowboys vs giants

No comments:

Post a Comment

Note: Only a member of this blog may post a comment.