MAINTAINING EFFECTIVE RELATIONSHIPS
Maintaining effective relationships with stakeholders will be vital in order to achieve the FCA vision. There will be a very wide range of stakeholders, such as the PRA and the Bank of England; the regulatory family including the Financial Ombudsman Service (the ombudsman); other EU and international bodies; financial services firms; consumer organisations; and audit and law firms. In this chapter we set out how we will work with some of these organisations.
We will maintain statutory memorandums of understanding with some of these organisations; setting out how we will work together. These agreements will be important, but what will actually make the system effective is a culture of working together, which our senior management will encourage.
The regulatory family
We will be part of the wider family of regulatory bodies that are in place to protect financial consumers:
• The ombudsman provides an independent, free-of-charge service that helps consumers to handle their complaints against firms.
• The Financial Services Compensation Scheme (FSCS) may pay compensation to consumers when a firm is unable, or likely to be unable, to pay claims against it, usually because it has failed or ceased to trade.
• The Money Advice Service provides free, unbiased advice to help consumers make the most of their money.
Each organisation plays a vital role in protecting consumers and helping to achieve better consumer outcomes.
We will have statutory oversight of the ombudsman, the FSCS (jointly with the PRA) and the Money Advice Service, although they will be operationally independent. This means we will be responsible for ensuring they are capable of exercising their functions, and we will have powers relating to board appointments. We will maintain strong, open and flexible relationships with each organisation, as they can provide us with very useful insight into the issues affecting consumers and how firms are behaving – such as the types of problems that consumers contact the Money Advice Service about. We will then be able to use this information to decide whether to intervene and to inform our policies and other activities.
Working with the ombudsman
The Financial Services Bill sets out two new ways for the ombudsman to bring issues to our attention.
The ombudsman will have to provide us with information about the level and nature of the complaints it receives when it thinks this information would or might help us achieve our objectives. This will give us an early view of the issues affecting consumers, which will mean we can be more proactive in our actions.
Maintaining effective relationships with stakeholders will be vital in order to achieve the FCA vision.
We will maintain strong, open and flexible relationships with each organisation, as they can provide us with very useful insight into the issues affecting consumers and how firms are behaving….
It will also be able to refer matters to us if one or more firms are regularly failing to meet our requirements and consumers have suffered, or are likely to suffer, as a result. We will publish a response to this referral within 90 days, setting out how we have dealt with the referral and whether we have decided to take any action.
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