The FSA intends to define mis-selling in the near future, following Ron Sandler's recommendation t...
The FSA intends to define mis-selling in the near future, following Ron Sandler's recommendation that the term needed greater clarification for product providers, intermediaries and consumers.
The move is included as part of the regulator's proposals concerning the problematic professional indemnity insurance (PII) market.
In its consultation paper on PII issued on 3 February, the FSA claims current difficulties in obtaining cover are based on past reviews initiated by the regulator and the threat of further reviews in the future.
While it will look to define mis-selling in the future, the regulator noted the threat of reviews has already diminished and should not be having an impact on obtaining PI cover. Its power to conduct reviews has been severely limited with the passing of the Financial Services and Markets Act 2000.
The act specifies that although it is for the FSA to report to the Treasury on the proposed use of this power, it is the Treasury that must decide whether parliamentary app-roval for a review should be sought. This requirement for parliamentary approval from both houses is a powerful safeguard against unwarranted use of this power, according to the FSA.
Partner Insight: Introducing the Architas education series for clients.
'Fewer than 1% of firms PROD-compliant' - Rory Percival
'Left holding the can'
'VCTs and EIS compared' panel
Letter to Women and Equalities Committee