Watchdog gives consumers more bite

The FSA wants us to be better informed

The new head of the Financial Services Authority says he's determined to make consumers more confident about the industry.

John Tiner, who has just taken over as FSA chief executive, is setting up a taskforce to look at ways of making the public better educated and informed about their financial affairs.

And he's also working on a system to carry out risk assessments on new investment products before they reach the public.

Speaking at a dinner in the City of London, he said capable consumers could form an influential force in the market which could mean less rigorous regulation.

Widespread mis-selling

He admitted that consumer confidence in financial services had been shaken over the past few years.

Investors had suffered because of the widespread mis-selling of endowments, the near-meltdown of Equitable Life and the collapse of some split-capital investment trusts - products that were frequently marketed to consumers as low-risk.

This is not just about overloading consumers with more information and more small print. John Tiner, FSA chief executive

The recent share price slump has also deterred many consumers from putting their spare cash into stock market-linked products.

Now Mr Tiner wants to regain consumer confidence.

"We'll be significantly stepping up the effort to educate and inform consumers about financial services so they themselves can be better equipped to work out what they want and when they want it and shop for it themselves," he told the BBC.

"This is not just about overloading consumers with more information and more small print."

Plainer language

"This is about making sure that what consumers really need to know about is much clearer to them, is written in plainer language.

"There's a lot that can be done to get the message through to consumers that they need to take responsibility and work themselves at understanding more about financial services so they can take care of their own future affairs."

Mr Tiner also wants to streamline the amount of regulation the FSA churns out.

"We will be putting increasing pressure and supervision on to firms themselves to make sure they are building into their business operations our requirement to treat their customers fairly," he says.

"I think they'll see more intensive supervision at that level."

Companies will also come under pressure to deal with complaints more effectively and efficiently.