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  • FIRST POST
    • MSE Guy
    • By MSE Guy 1st Apr 13, 12:00 PM
    • 1,628Posts
    • 1,255Thanks
    MSE Guy
    MSE News: 'We will be different to the FSA'
    • #1
    • 1st Apr 13, 12:00 PM
    MSE News: 'We will be different to the FSA' 1st Apr 13 at 12:00 PM
    "'We will be different to the FSA', says new regulator, the FCA, as regime changes today... "

    Read the full story:

    'We will be different to the FSA'





    Click reply below to discuss. If you havenít already, join the forum to reply. If you arenít sure how it all works, read our New to Forum? Intro Guide.
Page 1
    • MothballsWallet
    • By MothballsWallet 1st Apr 13, 1:06 PM
    • 13,489 Posts
    • 18,718 Thanks
    MothballsWallet
    • #2
    • 1st Apr 13, 1:06 PM
    • #2
    • 1st Apr 13, 1:06 PM
    Another problem with the FSA was its lack of cajones in using its ultimate sanction of taking away a licence from a firm: too many finance firms got to that point, but the FSA refused to take their licence away because they were scared of looking like a poor regulator.

    Another problem was that when eBay and PayPal moved to Luxembourg to avoid coming under FSA regulation, I don't recall anything being said, even though they now come under EU law.
    Last edited by MothballsWallet; 01-04-2013 at 1:09 PM.
    Always ask yourself one question: What would Gibbs do?

    I live in the UK City of Culture 2021
    • Pincher
    • By Pincher 1st Apr 13, 6:00 PM
    • 6,516 Posts
    • 2,491 Thanks
    Pincher
    • #3
    • 1st Apr 13, 6:00 PM
    • #3
    • 1st Apr 13, 6:00 PM
    What I don't understand is, mis-behaviour is NOT a crime.
    How can you chop any one's head off for mis-conduct?
    Rats will be dancing in the rafters tonight.


    I would like to raise the FCA's attention to the emergence of GAP insurance. I came across this thing six years ago, and it's appeared again in March 2013.

    The GAP insurance will pay out if your car is written off by your car insurance company in the first three years from new.
    The pay out is the difference between the brand new price aad the insurance payout. So, if you bought a new car for £15k, but in year two you have a bad accident, so the car is written off, and the insurance company pays you £10k, the GAP insurance will pay you £5k to put you back in the position to buy a new car, minus the £400 premium, of course. The GAP does not pay out if your insurance repairs the car.

    Insurance companies apply a simple formula to decide whether to write off a car. if it's going to cost more than £7000 to repair a car that is worth £10,000, then they will just give you £10k, and write the car off. Accident repairs are more likely to be £500 to £2,000 , so a write-off hardly ever happens in the first three years, so the GAP insurance very rarely pay out.

    It is possibly even more useless than PPI, but the persistence of the salesman means it must be highly lucrative. After saying NO at every encounter, he has the audacity to say THE FSA considers the insurance SO IMPORTANT, that I have to sign a document to prove to the FSA I have been offered this insurance.

    Effectively, the car dealership is pretending the FSA believes I should buy the GAP insurance, and the salesman cannot sell me the car unless I sign the document saying I categorically do not want GAP insurance, even though it is (seemingly) against FSA advice.

    Selling you something you will unlikely to benefit from is what
    a good salesman does. Millions of motorists have been sold a lemon and keep going back for more. Can't be helped.

    What I do object to, is, the dealership pretending the FSA is recommending an insurance by implication. This is mis-representation of the FSA/FCA's name for gain. This certainly comes under the category of MIS-CONDUCT, but NOT a crime.

    Fudge ahead, FCA, I expect nothing from you. All sensible intelligent people know that the only way to enforce good business practice is to have both parties turn up with Tommy guns, count the cash and the goods under armed supervision, before shaking hands and saying "Nice doing business with you.". Oh yah, back out of the room with safety off.
    • Consumerist
    • By Consumerist 1st Apr 13, 8:13 PM
    • 5,199 Posts
    • 2,602 Thanks
    Consumerist
    • #4
    • 1st Apr 13, 8:13 PM
    • #4
    • 1st Apr 13, 8:13 PM
    What I don't understand is, mis-behaviour is NOT a crime.
    How can you chop any one's head off for mis-conduct?
    Rats will be dancing in the rafters tonight.
    Originally posted by Pincher
    Where does this drivel come from?

    Removing a licence to operate hardly constitutes chopping off someone's head.
    Last edited by Consumerist; 01-04-2013 at 8:16 PM.
    Warning: In the kingdom of the blind, the one-eyed man is king.
  • temporary1
    • #5
    • 2nd Apr 13, 9:36 PM
    Well that's alright then, no harm done...
    • #5
    • 2nd Apr 13, 9:36 PM
    So the former regulators that were complicit in the destruction of all our public and personal financial losses get a quick re-brand, rather than a public lynching of every one of them. Justice ain't what it used to be.
    • talexuser
    • By talexuser 2nd Apr 13, 10:36 PM
    • 2,652 Posts
    • 2,086 Thanks
    talexuser
    • #6
    • 2nd Apr 13, 10:36 PM
    • #6
    • 2nd Apr 13, 10:36 PM
    So the former regulators that were complicit in the destruction of all our public and personal financial losses get a quick re-brand
    Originally posted by temporary1
    Not all. Turner who as head of the CBI was a leading proponent of Britain joining the Euro !!, and then headed the FSA with such success through the economic crisis, is off to a job in the George Soros thinktank.
    • huudi
    • By huudi 3rd Apr 13, 10:50 AM
    • 12 Posts
    • 1 Thanks
    huudi
    • #7
    • 3rd Apr 13, 10:50 AM
    • #7
    • 3rd Apr 13, 10:50 AM
    I had a simple clear case of breach of contract rejected by the FSA last year. They stated that although they allowed the fund to quote the FSA as their governing body they in fact had no jurisdiction over them?!? I may refer this to the new body.
    In the case of PPI, nobody HAD to buy, I certainly didn't, if they did they then thought it a safeguard worth paying for. I can see no case against the Banks whatsoever. Whoever started this one clearly wants to see the end of banking in the UK.
    • Consumerist
    • By Consumerist 3rd Apr 13, 11:07 AM
    • 5,199 Posts
    • 2,602 Thanks
    Consumerist
    • #8
    • 3rd Apr 13, 11:07 AM
    • #8
    • 3rd Apr 13, 11:07 AM
    . . . In the case of PPI, nobody HAD to buy, . . .
    Originally posted by huudi
    But, in many cases, that is what customers were told by the banks (or loans would not be given).

    Also, in many cases, customers would never qualify to claim on these "policies" so the banks were engaged, at best, in blatant misrepresentation or, at worst, deliberate fraud.

    I only hope, for our sakes, you are not a banker - or heaven help us all.
    Warning: In the kingdom of the blind, the one-eyed man is king.
    • dunstonh
    • By dunstonh 3rd Apr 13, 11:23 AM
    • 98,300 Posts
    • 66,548 Thanks
    dunstonh
    • #9
    • 3rd Apr 13, 11:23 AM
    • #9
    • 3rd Apr 13, 11:23 AM
    With PPI, no-one comes out of that smelling like roses. The banks did use over the top pressure skills coupled with low knowledge and poor trained staff. Then you starting having people with no financial background selling it (car dealers, people buying goods on credit etc). The FSA knew PPI was being sold that way for 20 years and gave no warnings but decided more or less overnight to say it was wrong and then backdate 2011 rules retrospectively making it very difficult for the banks to deal with complaints. Consumers have seen it as a chance to make easy money and there are now more try-it-on/fraudulent complaints than genuine ones. Claims companies are profiteering with their lies to get people signed up. No-one really holds the moral high ground on this. It really is the wild west. Scam sales, scam complaints, scam companies scamming consumers into putting in scam complaints.....

    The FSA's biggest failing was it's focus on micromanagement of minor or insignificant issues whilst totally ignoring the major issues. It put very little focus on shutting down scams. Most of us here suffer the scam phone calls every week. Boiler Room Scams, pension transfer scams such as those that say they will pay you a bonus if you transfer or you can get cash from your pension. Yet you see little action to stop those but we see consumers being hit by these week after week on these forums. IFAs account for 1% of complaints at the FOS and the FOS reject most of those. Yet the FSA spent more money on IFAs than it did any other area. Any business person will tell you that you dont waste over £4 billion in an area that accounts for under 1% of issues. You focus on the areas that do create issues or require sorting.

    When you ask what the FSA got right during its tenure, you would be hard pushed to think of anything.
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
    • Consumerist
    • By Consumerist 3rd Apr 13, 11:40 AM
    • 5,199 Posts
    • 2,602 Thanks
    Consumerist
    . . . No-one really holds the moral high ground on this. It really is the wild west. Scam sales, scam complaints, scam companies scamming consumers into putting in scam complaints.....
    Originally posted by dunstonh
    Whilst agreeing with much of what you say, I think you misjudge the public to some extent.

    I think the truth is that most of joe public don't understand much of what goes on in the financial world and have made PPI claims simply because they just don't know whether they have been scammed or not and take a just-in-case approach. It's no different, in my view, to seeking advice about any benefits a person might be entitled to claim.
    Warning: In the kingdom of the blind, the one-eyed man is king.
    • grizzly1911
    • By grizzly1911 3rd Apr 13, 11:49 AM
    • 9,818 Posts
    • 11,414 Thanks
    grizzly1911
    Not all. Turner who as head of the CBI was a leading proponent of Britain joining the Euro !!, and then headed the FSA with such success through the economic crisis, is off to a job in the George Soros thinktank.
    Originally posted by talexuser
    At least he didn't get the BOE job.
    "If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....

    "big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham
    • grizzly1911
    • By grizzly1911 3rd Apr 13, 11:54 AM
    • 9,818 Posts
    • 11,414 Thanks
    grizzly1911

    Effectively, the car dealership is pretending the FSA believes I should buy the GAP insurance, and the salesman cannot sell me the car unless I sign the document saying I categorically do not want GAP insurance, even though it is (seemingly) against FSA advice.



    What I do object to, is, the dealership pretending the FSA is recommending an insurance by implication. This is mis-representation of the FSA/FCA's name for gain. This certainly comes under the category of MIS-CONDUCT, but NOT a crime.

    Fudge ahead, FCA, I expect nothing from you.
    Originally posted by Pincher
    The last car, we brought for cash, still had all the FSA compliance rubbish to go though and sign to say we weren't interetsted. In the middle of the patter also tried to sell some form of polish system to protect the paint, before sale, and infereed this was an FSA recommendation too.

    I did make the point that if the paint was so poor should I withdraw from the purchase.
    "If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....

    "big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham
    • talexuser
    • By talexuser 3rd Apr 13, 12:03 PM
    • 2,652 Posts
    • 2,086 Thanks
    talexuser
    At least he didn't get the BOE job.
    Originally posted by grizzly1911
    You're right, he was mentioned in the running. As good as Steady Eddie getting the job after overseeing BCCI!
  • disposalist
    Being one of the ones currently getting screwed by BoI and Mr Wheatley having recently been utterly unhelpful and aloof regarding the issue (something about "it's not in our [the FSA's] remit". Who's is it then?) I'm not particularly comforted by his comments about how lovely the FCA will be for customers - he probably defines 'customers' differently to everyone else...

    He said, "banks shouldn't trap their captive customers to a higher rate, so they've got to offer people some choice", so will the FCA do something about the BoI shafting their customers with a 'take it or take it' more-than-doubled tracker rate? I won't hold me breath.

    (Before you have a go at me and BTL landlords here, the thread is over here http://forums.moneysavingexpert.com/showthread.php?t=4470099)
    • dunstonh
    • By dunstonh 3rd Apr 13, 12:38 PM
    • 98,300 Posts
    • 66,548 Thanks
    dunstonh
    Whilst agreeing with much of what you say, I think you misjudge the public to some extent.

    I think the truth is that most of joe public don't understand much of what goes on in the financial world and have made PPI claims simply because they just don't know whether they have been scammed or not and take a just-in-case approach. It's no different, in my view, to seeking advice about any benefits a person might be entitled to claim.
    Originally posted by Consumerist
    I believe there are people out there who are confused. However, when over half the complaints you get have no PPI at all but the complaints letter sent in makes all sorts of allegations, then you cannot consider that person to be confused. If they are going to allege wrongdoing and give a story of events that is total fiction, then you cannot give them the benefit of the doubt. (although the current system does).

    That said, the issue was discussed in parliament a couple of weeks ago and the general consensus is that the current system is stacked too heavily in favour of opportunistic complaints which standard to lose nothing by making false allegations whilst creating a cost, often significant, to defend. A cost that is damaging companies as well being factored into the pricing which honest consumers have to pay.
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
    • campari
    • By campari 3rd Apr 13, 2:28 PM
    • 22 Posts
    • 6 Thanks
    campari
    Regulation of all financial products? It took a while for the FSA to take on Hire Purchase. As for consumers who are not fully informed, there are many that are and they still get the 'run-around' from companies procrastinating for years in order to avoid settling. I personally found that the FOS failed to recognise failings with mortgage products that were clear cases of mis-selling and was forced to take court action as a litigant in person, yet another area that will be on the increase.
    • jago25_98
    • By jago25_98 3rd Apr 13, 8:36 PM
    • 617 Posts
    • 129 Thanks
    jago25_98
    I think in general the change means more power to them?
    Order of events: Banks lose our money -> get bailed out -> were inflating GBP to cover it -> now taxing us -> next will grab your funds direct -> things get really desperate to balance the books. What should have happened?: banks go bust and we lost our money much quicker
    • BJV
    • By BJV 4th Apr 13, 4:14 PM
    • 2,255 Posts
    • 3,376 Thanks
    BJV
    Some of the references to gap insurance i have to say are factually incorrect.

    Yes i agree in the insurance company will apply a 60 % rule in which to calculate if a vehicle is still economically viable.

    But a repair bill of £500- £2000??? Wish it was. Modern vehicles are designed to absorb impact away from drivers and passengers. This means that even more minor accidents result in more damage. The replacement of a couple air bags alone would be close to £1000.00 Most modern vehicles now have 6 8 even ten air bags.

    You then have the environmental issue of repairs a car.

    Thank god for the sake of our planet things like tyre's have to be disposed of correctly.

    Labour rates, raw materials etc.

    So if you can get a reasonably aged car repaired after an accident for £2000 please tell me where?

    And sorry if you are paying dealership prices for gap insurance more fool you!

    I do however agree that car sales people should not say that they have a legal obligation to offer gap insurance.

    Instead part of their duty of care would be better.

    From an insurance perspective the new body is simply putting more and more responsibility on the insurer and seemingly taking less themselves.
    Happiness, Health and Wealth in that order please!
  • innovate
    Stop the known culprits to ever get a job in any UK financial institution again.

    If you agree, you can sign a petition that will be presented to the FCA
    Dear Financial Conduct Authority,

    "Reckless" and "deluded" - that's what three ex-HBOS bosses have been called by a parliamentary commission.

    Lord Stevenson, Sir James Crosby and Andy Hornby ran HBOS into the ground - leaving taxpayers to fund its £30bn bailout. They deserve more than a simple slap on the wrist.

    Please use your power to hold them to account and ban them from working in the finance sector again.
    https://secure.38degrees.org.uk/page/s/banking-bosses
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