FCA Name and Shame Plans Are Blasted

The Financial Conduct Authority has confirmed that plans will go ahead to ‘name and shame’ financial firms that are being investigated by the regulator.

This is not a publish names when investigations are complete and regulatory action is to be taken, these are plans to ‘name and shame’ when the investigation is in progress.

These plans have been labelled a ‘blunt tool’, but the FCA has retorted to say that it will act as a deterrent to encourage firms to have good principles and have good practices to prevent poor consumer outcomes.

Many financial firms are worried that it will damage reputations of businesses that may in fact be found ‘not guilty’ and push consumers away from those firms as well as ‘kill off’ new business flow to those firms implicated.

The Chancellor, Jeremy Hunt has urged the FCA to reconsider as have many in the financial services industry.  Even the House of Lords has urged the FCA to reconsider given damage could be done to the name and reputations of firms even if they are found ‘not guilty’.

Comment

We have to say, whilst we always strive for best practice and to act with due care and diligence to deliver the best outcome for our clients, this stance by the FCA is not just worrying, it is bordering on dictatorial.

Whatever happened to ‘innocent until proven guilty'? 

It’s a shame the FCA will not also publish the names of their staff that have not performed their own duties satisfactorily causing consumer detriment or even those FCA employees that are being monitored or under investigation.  One rule for them and a totally different rules for financial services firms.