Financial Conduct Authority fines should subsidise the Financial Services Compensation Scheme rather than going into the pockets of the Treasury, Aegon has claimed.
The pension, insurance and investment company felt the burden is unfairly placed on advisers to fund the FSCS.
Steven Cameron, pensions director at Aegon, said: “We see a strong case for the FSCS scheme to be part-funded from fines imposed by the FCA on firms which operate in the same markets the FSCS covers.
“The FCA is currently required to pay fines, minus enforcement costs, to the Exchequer. The fines, which have totalled £3bn in the last four years, often result from failings by regulated firms, which may involve consumer detriment, and are paid on top of any necessary financial redress.
“Rather than fines going into a central government slush fund, we are calling for the Treasury to pay a contribution from them into the FSCS, to be used to compensate consumers who suffer financial loss at the hands of a small minority of ‘failed’ firms.
“This represents another form of the ‘polluter pays’ approach and would reduce the burden well-run firms currently face to pay for the regulatory breaches of others.”
