About three years after the United Kingdom’s financial regulatory body banned commission payments to financial advisers who sold extra retail products to customers, the same authority is considering an end to the ban, once touted as a way to protect consumers, the Financial Times reported. As acting chief executive of the Financial Conduct Authority, Tracey McDermott said Saturday the body was considering ending the ban put in place to end "misselling." She also denied that the FCA was somehow easing its oversight of the country’s banks.
“What we do want to look at is actually what is the best way of delivering advice and guidance across the market, so I wouldn’t rule out that there may be some element of commission, but we are not going to reverse the retail-distribution review,” McDermott said. After some bank customers claimed they were sold unnecessary products by the banks, they won compensation, Reuters reported.
The FCA weeks ago ended a monthslong review of banking culture in the U.K., earning the ire of a number of politicians on Parliament's Treasury Committee, the Financial Times reported earlier. McDermott was then asked to appear before a committee later this month to explain her reasoning.
She said Saturday the FCA is “not going soft on the banks; we're not being told what to do by the government," Reuters reported. "If you look at what I've been doing in the last six months since I've been in the role as chief executive, you'll see that we have continued to take action against the industry.”
— Ian Fraser (@Ian_Fraser) January 5, 2016
McDermott used the example of a $105 million fine imposed on Barclays bank in December to demonstrate the FCA’s continued approach of taking action against banks. U.K. banks faced hard times after the 2008 financial crisis, hurting from negative public opinion of them after some were bailed out.