Consultation has kicked off on the role of the FSA and the Financial Ombudsman Service following Treasury induced moves to revisit responsibilities outlined in the Financial Services and Markets Act 2000.
Consultation Paper 04/12 Year 2 Review: Financial Ombudsman Service will focus on two major questions:
According to FSA discussions with “stakeholders” in the regulatory process, there is “no clear consensus” on what changes may be necessary.
However, it is also the case that some “stakeholders” are asking for “clarification” on the roles and responsibilities of the FSA and FOS in so-called wider implication cases, which are individual cases that may set precedents for other similar cases.
The FOS involvement in the consultation paper stems from its need for input on the question of whether it should continue with a regime of “test cases” that may be used “as an alternative to us making decisions on cases that turn on a legal issue.”
The question of what responsibilities the different regulatory bodies have is underlined by results published by the FSA earlier this week.
Consumer Research paper 29 found that 8% of consumers questioned said they believed the FSA’s main role was to give compensation, while hardly any were able to distinguish between the FSA and FOS.
”It is perhaps unrealistic to expect that consumers know the difference between different elements of the regulatory approach and the separate responsibilities of the FOS and the Financial Services Compensation Scheme, but it indicates that there is some awareness that individual consumers can obtain redress,” the paper states.
Responses to CP 04/12 must reach the FSA by 1 October this year.IFAonline
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