Financial Conduct Authority  

FCA consults on its role as regulator

FCA consults on its role as regulator

The Financial Conduct Authority has published its "mission" in a bid to clarify how it works.

The document lists eight themes which the regulator will be consulting on, and expands on its proposed approach.

Among these is protecting consumers, with the FCA saying there is a need to achieve a "balance of responsibility" between consumers and firms.

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It said: "Meeting our consumer protection objective is not about ensuring a market where consumers never make poor choices, but about ensuring they have an appropriate degree of protection.

"The respective responsibilities of consumers and firms in financial services are more complex.

"While regulated firms must meet minimum standards, the balance of consumer/firm responsibility will vary depending on the particular product or transaction and how it is sold."

The document also seeks to set out when the FCA would intervene, saying it intends to be more transparent about the things it chooses to do and the things it decides not to do.

It also pledges to be clearer in communicating it's assessment of the underlying cause of harm or risk it is seeking to address.

The FCA has also asked whether its approach to long-term products is working.

It said they are affected by uncertainty and "present bias", making the regulation of these products "inevitably challenging".

The FCA is also seeking suggestions for a proposed review of its handbook.

Andrew Bailey, the chief executive of the FCA, said: "Establishing and embedding a clear mission for the FCA is critical to our success, both as a regulator and to UK financial services as a whole.

"Our mission will set out a framework within which we prioritise our work, ensuring we focus our resources in the right places.

"This will improve accountability and transparency of how and why we make the choices that we do."

But he said the mission would only be a success if members of the financial services industry took part in the consultation which starts today and runs until 26 January.

The FCA has said it "is not possible, or desirable" to create markets and firms which never fail.

Instead the regulator proposes to apply "forward-looking...and backward-looking judgement" in enforcing its framework of rules.