Members of Parliament have hit back at the Financial Conduct Authority (FCA) for its seeming failure to adequately address an earlier report that branded the watchdog as 'incompetent at best, dishonest at worst', amid calls far-reaching reforms.
The All-Party Parliamentary Group (APPG) on Investment Fraud and Fairer Finance presented its report to Parliament in November after collecting evidence from 175 respondents, including whistleblowers, victims of scams and current and former employees of the regulator.
In response to the criticisms, the FCA stated: "We strongly reject the characterisation of the organisation. We have learned from historic issues and transformed as an organisation so we can deliver for consumers, the market and the wider economy.”
The response has enraged parliamentarians, who are returning with a series of supplementary reports detailing case studies on recent scandals such as Woodford, Wealthtek, Philips Trust Corporation and Car Finance.
"The FCA won’t be able to hide behind the claim that the issues raised are historic." says Bob Blackman co-chairman of the APPG. "New evidence that the APPG has received since our first report was published means we were right to be unconvinced that true transformation has taken place at the regulator."
Sam Rushworth co-chairman of the APPG notes that the FCA's leadership team engages far more with industry bodies than it does with consumer organisations.
"For every one meeting with a consumer body there are almost five with the industry," he says. "That ratio excludes all the meetings the FCA has with regulated firms, so the overall picture is even worse.
"It’s therefore doubtful the consumer voice is being properly heard at the FCA, and it makes you wonder if the FCA, or some other entity, ought to be given a sole pro-consumer role, as per the USA’s Consumer Financial Protection Bureau which does not have the conflicted and competing interests the FCA has. Unlike the FCA it is not being continuously pulled in different directions.”