Speaking at the official launch conference of the Financial Conduct Authority (FCA), Sants said there had been “little or no” significant change in the attitudes of the industry towards its customers since Howard Davies, the FSA’s first chairman, bemoaned the failure of firms to learn the lessons of past mis-selling in 2003.
He quoted Davies as saying: “The biggest disappointment of my time at the FSA has been the failure of firms, in particular their senior management, to learn the lessons of past mis-selling.”
Sants, who said he would now be taking an “increasing back-seat role” in the new regulatory structure, added today: “These words are as true now as they were then.”
He said the regulator’s TCF initiative had increased awareness of mis-selling issues, but that there was little evidence of “real improvements on the ground”.
FSA director of enforcement and financial crime Margaret Cole, speaking at the same conference, identified personal pensions, mortgage endowments, split-capital trusts and payment protection insurance as products which had been mis-sold to UK consumers on a large scale over the past two decades.
Sants said the FCA represents a radical new approach to regulation.
The FSA and Treasury have invited comments on the scope and remit of the new regulator, which is due to come in at the end of next year.
Yesterday, the FSA set out its latest thinking on the FCA, stating it needed to deliver a “more proactive” style of regulation characterised by early intervention both of products and sales practices to protect consumers.
This would need to be balanced by efforts to maintain healthy competition in the market, it said.
