The letter urges the regulator to use its teeth to help restore consumer confidence in financial services. The letter also sets out a series of challenges to be met within the first 100 days of receiving its full regulatory powers.
Consumers’ Association expects to see real improvement for consumers including:
High quality financial advice and rogue financial advisers driven out of the industry;
Protection of consumers in the mortgage market;
Cleaning up long-term savings products such as with-profits;
With-profits policyholder funds protected from raids by shareholders;
Compensation for consumers mis-sold endowment mortgages.
Sheila McKechnie, director at the Consumers’ Association, said: "Consumers’ Association has long campaigned for a strong financial regulator. The advent of N2 offers a fresh start for consumers in financial services. This is a real opportunity and challenge for the regulator to work proactively to protect consumers, to prevent financial scandals and to ensure consumer confidence when investing in the industry.
"A consumer-focused regulator is needed now more than even to improve industry performance and consumer confidence in a sector dogged by scandal.
"The new powers should help financial companies to deliver high quality and affordable products and services to consumers. In order to rebuild consumer confidence Consumer’ Association has set a number of challenges for the FSA. To help it meet these challenges we have recommended a new approach to regulation with three guilding principles which we urge the FSA to adopt; a proactive approach, open and transparent decision making and a consumer protection culture."
