New banking watchdog takes over from 1 AprilFinancial Conduct Authority replaces FSA
27 March 2013
The Which? Watchdog not Lapdog campaign called for the new financial services regulator, the Financial Conduct Authority (FCA), to be strong, open and proactive. The new regulator takes on its full powers with effect from 1 April 2013.
In June 2010, the coalition government confirmed it would divide the responsibilities of the FSA into two new bodies; a watchdog for consumers - the FCA - and the wider, system-focused Prudential Regulation Authority (PRA).
FSA becomes FCA
Since the split was announced, Which? has been campaigning to make sure that the new FCA will work in the interest of consumers as a true watchdog. The FCA will operate as a consumer champion, tasked with improving competition in the banking sector and preventing dodgy financial products from making it to market.
Richard Lloyd, Which? executive director, said: 'We'll be watching closely to make sure the FCA is a true watchdog, keeps to its word and puts consumers at the heart of everything it does.'
Strong, open and proactive
The Which? Watchdog not Lapdog campaign called for the new regulator to be:
- A strong regulator that stands up to the banks and promotes competition. Which? wants the FCA to issue fines that are big enough to act as deterrents and promote competition by making sure products are transparent, simple to compare and easy to switch between.
- An open regulator that tells consumers what it does. Which? wants the FCA to tell consumers when firms are found to have broken the rules, what it is investigating and what it is going to do to stop it.
- A proactive regulator that acts on issues before they become problems. Which? wants the FCA to take a more proactive approach and ban dodgy financial products and misleading adverts before they cause problems. Lessons must be learnt from the payment protection insurance mis-selling scandal.
Which? will keep a close eye on the new regulator to make sure it is strong, open and proactive, and uses its powers to protect consumers.