Watchdogs moot new consumer protection committee

The FSA, the Office of Fair Trading (OFT) and the Financial Ombudsman Service have teamed up with a proposal for a new consumer protection committee to spot emerging risks.

The committee’s remit would be to identify any emerging risks with the potential to turn into widespread problems, and determine fast and effective ways of dealing with them, whether through regulatory action or consumer complaints.

As set out in a discussion paper issued today, the committee’s work will be to update the wider implications process, which is often triggered once a problem has already had an impact.

It would draw together specialists from the three bodies to spot emerging risks, increasing the ability of the regulators and ombudsman service to respond to threats in the market.

Sheila Nicoll, FSA director of conduct policy said: “Complaints handling is a priority area within the FSA’s intensive supervision agenda. The co-ordination committee is a clear indication of the intention, and will, of the authorities to work even more closely together to improve the experience of consumers, and to avoid problems happening in the first place.”

Ray Watson, OFT director of consumer credit, said: “Identifying and dealing with problems at an early stage is important for ensuring consumers do not suffer unnecessary harm from financial products. We believe that the proposals for a new co-ordination committee and the focus on risk will improve our ability to deal with problems before they become widespread.”