Consumer protection committee plans
The City watchdog announced plans to launch a new committee to spot problems in the financial services sector before they affect large numbers of consumers.The Financial Services Authority is proposing joining forces with the Office of Fair Trading and the Financial Ombudsman Service to form a new consumer protection committee.
The committee would look out for sales practices or product designs which have the potential to turn into mis-selling scandals or create widespread consumer detriment.
The move would update the current "wider implications process" under which the three groups come together to tackle financial issues that fall into all of their areas and are affecting a large number of consumers.
But the process is often only triggered once a significant number of people have already been affected.
The wider implications process has recently been used to look at issues including unauthorised overdraft charges, the sale of payment protection insurance and the plight of policyholders in closed with-profits funds.
Sheila Nicoll, FSA director of conduct policy, said: "The co-ordination committee is a clear indication of the intention and will of the authorities to work even more closely together to improve the experience of consumers, and to avoid problems happening in the first place."
Ray Watson, OFT director of consumer credit, said: "Identifying and dealing with problems at an early stage is important for ensuring consumers do not suffer unnecessary harm from financial products.
"We believe that the proposals for a new co-ordination committee and the focus on risk will improve our ability to deal with problems before they become widespread."
The wider implications process has recently been used to look at issues including unauthorised overdraft charges, the sale of payment protection insurance and the plight of policyholders in closed with-profits funds.
Sheila Nicoll, FSA director of conduct policy, said: "The co-ordination committee is a clear indication of the intention and will of the authorities to work even more closely together to improve the experience of consumers, and to avoid problems happening in the first place."
Ray Watson, OFT director of consumer credit, said: "Identifying and dealing with problems at an early stage is important for ensuring consumers do not suffer unnecessary harm from financial products.
"We believe that the proposals for a new co-ordination committee and the focus on risk will improve our ability to deal with problems before they become widespread."
© 2012 Press Association