The Financial Conduct Authority came in for wide-ranging criticism from MPs last night (1 February), but the regulator was spared a vote of no confidence during a debate in the House of Commons.
The debate was brought about by Conservative MP for Aberconwy Guto Bebb, who tabled the motion that “this House believes that the FCA in its current form is not fit for purpose and we have no confidence in its existing structure and procedures”.
He kicked things off by stating it is four years since he first raised the issue of interest swap mis-selling in the chamber, followed by three back-bench debates on the issue, an adjournment debate on the Connaught Income fund and a debate on the Royal Bank of Scotland global restructuring group.
Mr Bebb said: “Some people have argued that this debate and this motion are premature. Given the evidence and information that I will present, I argue that they are long overdue.”
Conservative MP for Twickenham Tania Mathias contended the FCA has been too slow and not transparent enough for investors.
Mr Bebb questioned whether yesterday’s Connaught Income fund announcement of a settlement would result in full compensation for investors.
The MP moved on to the FCA’s decision to cancel a review into banking culture, without consultation with its board and contrary to objectives set out in a public meeting on 22 July.
“When that was pointed out to the FCA when it announced its decision to curtail the inquiry, it denied to The Financial Times that the issue of a review had ever been raised at a public meeting.
“However, the minutes of that public meeting are clear, and the regulator was stating an untruth to our No. 1 financial paper,” said Mr Bebb. “That does not give me any confidence in the regulator.”
Mark Garnier, a Conservative MP for Wyre Forest and member of the Treasury select committee, agreed there is plenty of evidence for how the regulator is “not necessarily standing up for the consumer”, but argued a motion of no confidence deserves a “more rounded view”.
He suggested MPs have “been guilty of what sports commentators do when a poor goalkeeper successfully saves many shots, but, when he lets through one crucial goal”, and is criticised by everybody for not being up to the job.
Mr Bebb responded as an Everton supporter, he has been patient with goalkeeper Tim Howard.
He said: “It is not that he made one mistake and allowed one goal to be scored; he has conceded half a dozen such goals this season. It is the same with the regulator. It is not the one mistake that we complain about; it is a pattern of behaviour.”