Having worked with financial institutions on business ethics, we welcome any initiative designed to protect consumers further and rebuild public confidence in the financial services sector.
Intervening earlier in the product chain is long overdue and should be welcomed, but will it lead to a lack of focus at the sharp end where these products are sold? Most of the fines and scandals of recent times have been about bad-selling not bad products. No matter how good the product, consumers need to be protected from smooth talking sales staff with incentives to sell a particular product that the customer neither needs nor understands.
We are concerned that the neither the FSA nor the future Comsumer Protection and Markets Agency will have the resources to increase scrutiny of products without relaxing the monitoring of selling. Without sufficient monitoring, bonus-driven sales tactics will still leave consumers unprotected and mistrust of financial service providers will remain high.