Government must open bankers’ behaviour to scrutiny

In welcoming today’s publication of the FSA’s bank complaints data, the Financial Services Consumer Panel has called for Government to remove the secrecy which keeps customers in the dark about the behaviour of their bank.

The publication of complaints data today has only been possible because of a voluntary agreement between the banks and the FSA. The Consumer Panel is campaigning for freedom for the FSA to publish the number and types of consumer complaints made against firms. The Panel is also today publishing detailed research demonstrating that the FSA now ranks as a world-class regulator in financial services in relation to publishing information and being transparent in its work¹.

Adam Phillips Consumer Panel Chair commented: “The FSA has recently been doing excellent work in getting the public the information they need to make informed choices about financial services. However, the FSA is forced to pull its punches by outdated legislation². The planned replacement of the FSA by the Consumer Protection and Markets Authority creates an opportunity to improve the information available to help consumers make better choices. It is vital the Government takes steps to introduce greater transparency and takes away the bankers’ cloak of secrecy.

Consumers have the right to know about the level and type of complaints made against banks. Only when consumers are empowered with enough of the right sort of information can they choose banks which will treat them fairly.”

1. Transparency as a Regulatory Tool[1] – an international literature review was written by John Leston and is available from the Consumer Panel website.

2. To allow for greater transparency, the Panel has argued for changes to s349 of FSMA 2000. Section 349 should be amended to allow information which the FSA finds in the course of its work, such as complaints data, to be disclosed in pursuit of its consumer protection objective with the usual safeguards of proportionality, cost effectiveness and subject to judicial review.

3. Adam Phillips, Consumer Panel Chair’s biography and photographs[2] are available.

4. The Consumer Panel is a statutory body under the Financial Services and Markets Act 2000 and was initially established by the Financial Services Authority in December 1998. The Panel advises the FSA Board on the interests and concerns of consumers and reports on the FSA’s performance in meeting its objectives.

5. The emphasis of the Panel’s work is on activities that are regulated by the FSA, although it may also look at the impact on consumers of activities outside but related to the FSA’s remit.

6. There are currently eleven members of the Panel as listed below. (For further information on individual members, see see Who is on the panel)[3]