The Financial Services Consumer Panel has urged FSA chief Sir Howard Davies to crack down on misleading adverts that could cause mis-selling.
Panel chairman Colin Brown was reported as telling Davies that an "unwieldy system" prevented the regulator from clamping down fast on misleading advertisements.
Brown added that the FSA often avoided a lengthy enforcement process by persuading the company concerned to withdraw the advertisement.
Brown said: "This means that people can potentially have been mis-sold while an advertisement was in the public domain, without ever knowing that this was the case."
The panel said that the main problem with the current system is that after the FSA received a complaint, it could not express an opinion until an enforcement process had been completed.
Brown said: "This is really quite extraordinary and leaves promotions which are against the rules in the public domain for long periods, without any warnings."
The FSA told FT.com that it was bound to operate within a government framework but that it planned to review cases soon.
