/ Money

New financial watchdog – we don’t want a lapdog

It’s the New Year, and in the spirit of turning over a new leaf, the government is throwing out the old rule book to recast the way the banks are regulated. Great – but we want to make sure this watchdog works…

Avid readers of Which? Conversation will know we’re pretty excited about the Financial Services Bill. We gave evidence to the committee that was set up to examine the draft version.

The Bill represents a once-in-a-generation opportunity to change how banks and financial firms are kept in line, and we’re determined to make sure that consumer protection is at the heart of the new system.

We want a watchdog, not a lapdog

So today, we launch our ‘Watchdog not Lapdog’ campaign. We want to make sure that the new financial regulator is the watchdog that consumers can count on, not a lapdog that panders to the interests of the banks.

Across our work we have seen how the current financial regulator, the Financial Services Authority, has failed to protect consumers from dodgy financial products and services.

We’re pleased that the government wants to provide the new regulator, the Financial Conduct Authority (FCA), with the ability to remove dodgy products and ban misleading adverts. We hope that these powers, plus increased openness about its activities (such as which firms it’s investigating) should go some way to ensure that consumer protection is at its heart.

What will make the new watchdog a success?

To be the watchdog consumers need, the FCA must be:

  • An open regulator that tells consumers what it does: We want the FCA to tell consumers when firms are found to have broken the rules, what it’s investigating and what it’s going to do to stop it.
  • A strong regulator that stands up to the banks and promotes competition: We want the FCA to issue fines that are big enough to act as deterrents and promote competition by making sure products are transparent, simple to compare and easy to switch between.
  • A proactive regulator that acts on issues before they become problems: We want the FCA to take a more proactive approach and ban dodgy financial products and misleading adverts before they cause problems. Lessons must be learnt from the payment protection insurance mis-selling scandal.

So if you agree that it’s about time we got a financial watchdog strong enough to stand up to the banks, support the campaign by telling the government you want a watchdog, not a lapdog – and share your thoughts in the comments below.

We’re also looking for a suitable dog to front our campaign. If you think you’ve a pooch perfect for the job, find out how you can nominate your dog to be the face of our campaign.

[UPDATE] – On Wednesday 22 February 17.30-19.30 Which? is hosting an event with the new head of the FCA, Martin Wheatley. This event, held in central London, will be a chance for people to share their experiences of the banks, insurance providers and other financial services that they use on a day to day basis, and tell Martin why he needs to make sure the FCA is the watchdog consumers want.

Now the Financial Services Bill is going through Parliament it’s more important than ever that Martin hears about your experiences. Its clear that Which? Conversation commenters have a lot of experience of the kind of things we want the FCA to stamp out, so if you want to attend the event please get in touch at: which.campaigns@which.co.uk or tell us about your experiences below.

Celia says:
8 February 2012

! do not wish to be associated with an event that prejudges the issue and in such tabloid language. “Lapdog that panders to the interests of banks” indeed. If I want to read emotive and cliche-ridden prejudice I can buy a copy of a red-top.

I shall cancel my subscription to Which? if this slide away from your much valued balanced and fact-based editorial style continues.


Don’t be too harsh on Which. I think they wanted to get out attention, and they did. The rest seems serious and mostly well supported by us the people who pay their salaries.

Hello Celia, Which? Conversation’s tone of voice strays from that of the main Which.co.uk website and the magazine.

Which? Convo is an informal blog for Which? experts to write in their own personal style, making it easier for readers to get into the debate, understand the issues and hopefully to relate to the author. Thanks.

Hilo says:
8 February 2012

The reason the banking crisis occurred was because (mostly) greedy gambling men found a system that made them loadsamoney. They were mathematicians who got jobs in the banks. I suggest that employees in a position to gamble with other peoples money have compulsory banking qualifications. Mr Fred Goodwin did not have any qualifications in banking. It is about trying to make these powerful men acknowledge that they have a duty to the rest of us and nor just to themselves, that greed is NOT good. When we hear yet another million pound bonus is being paid to the bankers, because they say they need to employ “the best” this doesn’t mean they need to be paid telephone number salaries. Put it to the test and apply the dutch auction method to fix their salaries and bonus. Any banker should state what remuneration he wants and the lowest one gets the job. There will be plenty of applicants. Also when a banker is disqualified because of malpractice, it should mean just that. In the debacle of the 2008 crash the men responsible for it were barred from working full-time so just went and got several part-time jobs and as a result were better off.

Gerald Glover says:
8 February 2012

I cannot make the next meeting BUT Tueday is 21 Feb not 22 as in your e mail.

Hello Gerald, sorry about that. The email has now been corrected – the correct date is Wed 22nd Feb. Sorry you can’t attend!

Typo repeated as to FCA?


[2 Feb 2011 … The Financial Services Authority (FSA) today announced the appointment of Martin Wheatley as the new managing director of its Consumer …]

Paul Jones says:
11 February 2012

I have experience of the FOS which did not address the problem of the false information given to me by IFA. The process was long winded (2 Years) and, in my opinion, a waste of time. I was left over £4000 out of pocket.

ChrisF says:
1 March 2012

Paul, I can only empathise! I have just completed a slightly shorter (18 months) FOS process. Yup, they left me out of pocket too. I am not going to give up though … next step is the financial press.

Paul, ChrisF,

Strength to your arm in what ever further actions you take. Why not write an email to the CEO telling him/her that you are planning to use the press to expose their unfair actions. Perhaps you could use http://www.ceoemail.com to find the CEO’s email, it wont cost you a penny, and might just get a result.

It seems crazy that an individual can loose thousands of pounds through no fault of their own, then be denied recompense from an enormously rich company, because of some ‘tricky’ thing in the paperwork. If you buy a product from a retail supplier and it fails or does not work properly, you are compensated, usually by the retailer but if necessary, under the Sale of Goods Act.

Surely with a financial product, the criteria could be the same, except in certain defined cases where say you buy a unit trust or shares which really cant be guaranteed. These products could have a Government defined health warning in big black letters like a packet of cigarettes.

A,Flack says:
28 February 2012

Like most government iniatives i expect the FCA to employ the same staff as the FSA so in the majority of cases no change me thinks ?

The Banks have, for some time now, been taking the Mickey out of depositors & are set to carry on doing so, I believe, until the year 2015.

Interest rates of 0.05%, they must be joking! They are using money deposited with them without the just rewards depositors deserve & in my opinion entitled to.