The Financial Services Authority has written to comparison websites following a review which highlighted areas of concern about the fair treatment of customers.
The City watchdog has identified processes that it believes may infringe regulations. In a letter to price comparison sites, the Financial Services Authority (FSA) asks the companies to think carefully about whether they are offering advice, which they are not allowed to do.
FSA writes to price comparison websites
The letter sets out proposed guidance covering a range of issues that relate to the fair treatment of customers. These include:
- Making it clear that responsibility for checking eligibility or disclosure lies with the comparison sites rather than with the customer;
- Reminding firms to ensure that where comparison sites use a third party site or ‘white label’ service, it is clear to customers which company they are actually dealing with;
- Reinforcing the requirement for the sites to abide by permission regulation, so that advice is not given;
- Reminding comparison sites that it is their responsibility to ensure that white label firms hold the necessary permissions to conduct regulated activities, such as giving financial advice.
Which? welcomes FSA letter
Which? Money editor James Daley said: ‘Our concerns have been about the focus on price and people not being warned about things like the exclusions in cheaper policies, there’s been lots of room for consumer detriment.’
August deadline for responses
Comparison websites have until 8 August to respond to the FSA’s proposed guidance, which was drawn up following a review of the market carried out between June and September 2010.
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