FSA criticised by its own independent panel
The Financial Services Consumer Panel, which was set up by the FSA around 10 years ago, is tonight in serious conflict with the FSA itself on the subject of consumer rights. The panel has reacted furiously to a FSA White Paper which would appear to put the onus on consumers to ensure their investments and investment advisers are aboveboard and protected. This is the first time for many years that we have seen regulators turn on the consumer and appear to pass the buck back to investors.
This move would appear to be directly at odds with the UK government's understanding of the situation and the promise for further regulatory powers for UK authorities. However, it is obvious that the situation needs to be clarified as any potential misunderstandings could have serious implications in the short to medium term. It is also worth remembering that funding for UK financial regulators has increased substantially, and is set to do so in the future, in order to try and take away the "self regulation" system currently in place.
Many UK investors will now be asking "What is the point of having the FSA when in effect the authority is looking to pass responsibility back to individuals?".
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