Rather than churn out endless reams of rules, the Financial Conduct Authority needs to make sure customers get what they have been sold.
I am fed up of fines for historic bad behaviour being aimed at banks and insurers.
The regulator needs to wake up to what is going on right now and the fact some pension providers and high street lenders have been mis-selling their services by pretending to be you - financial advisers.
Who hasn’t walked into their bank and been encouraged to speak to their customer service adviser, or received a letter from a provider offering to set up a meeting with one of their ‘experts’ who will “help you with your savings”?
I hope comments made by pensions minister Baroness Ros Altmann in an exclusive interview with FTAdviser this week serve as the call to action that the regulator needs.
She pointed out to first hand evidence of wake-up packs where pension providers are misleading savers into thinking they will receive advice from their organisation.
Baroness Altmann said: “I can quite see why the individual will think ‘I don’t need this Pension Wise’, I have had this conversation with my nice provider’s expert helper who is actually, of course, a salesman.”
Some providers and banks have been allowed to get away with leading their customers to expect they will be hearing about the best deal for them, when actually they are pushing the latest product.
This is mis-selling.
Even if the product they sell isn’t totally toxic, the consumer thinks they are receiving advice.
It is exactly the same as if I bought a coat, believing it was cashmere, before finding out it was actually some synthetic fibre.
When Baroness Altmann’s comments were put to the FCA, they declined to comment.
However, the regulator has previously stated that firms are required to comply with its Treating Customers Fairly principles and not mislead customers.
Since the at-retirement reforms last year, firms are required to sign-post customers towards Pension Wise and not do anything that might undermine that service.
The regulator is currently working with firms on behavioural trials to see how communications might be improved, both in wake-up packs and conversations about the free guidance service.
This is not enough.
Quite frankly, providers should also not undermine or mis-sell their services as being the same as yours.
The FCA needs to start doing the ‘Ronseal test’ - checking whether these businesses are doing what they say on their tins.
It is time for the regulator to encourage whistleblowing on firms that claim they offer advice, but do not have permission to do so.
Trading standards is hard at work chasing dodgy dealers and the Financial Ombudsman Service is too busy looking at mis-sold products of the past for them to turn detective about what is being pushed inappropriately today.
I want to see mystery shopping and fines handed out to those that offer advice but actually deliver sales patter.
You have to pay a lot to be regulated and call yourself a financial adviser. It is about time action is taken against those who use the rightly cherished word ‘advice’ to push product and just sell.
emma.hughes@ft.com