FSA calls for more ethical behaviour

4 June 2010 | By Natalie Thomas

The Financial Services Authority is to place more emphasis on standards of ethical behaviour in authorised firms and introduce a 30-month deadline for individuals to complete all modules of a qualification required for their role.

The FSA has today released its consultation paper - Competence and Ethics, which proposes to remove some transitional provisions which allow individuals to operate without formal qualifications, due to the arrangements under their previous regulator.

Further proposals clarify how individuals carrying out approved persons roles should demonstrate a good standard of ethical behaviour.

They will be expected to act in the interests of their client, avoiding consumer detriment and taking responsibility for their own level of competence.

The proposals seek to increase standards of professionalism across the industry, complementing the Retail Distribution Review plans and rules that are already in place for investment advice.

Sheila Nicoll, FSA director of conduct policy, says: “Competence and ethics are key elements of our regulatory regime and we have increased our scrutiny of individuals working in the financial services industry over the last few years.

“Ultimately it is in a firm’s commercial interest to recruit, train and retain good quality individuals but regulation ensures that standards of competence and ethics are maintained at an appropriate level.

“We have designed these proposals to enhance consumer protection by strengthening our competence and approved persons requirements. We want to see firms operating robust training and competence schemes and individuals demonstrating good standards of ethical behaviour.”

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Readers' comments (19)

Steve Rodley | 4 Jun 2010 10:34 am
Ho Ho....

Funniest thing I've read ALL year!!!!!

The FSA preaching about Ethical Behaviour???? Now that's rich!
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Anonymous | 4 Jun 2010 10:36 am
If they want to start kicking off about ethics they should start by paying a visit to any of the High Street banks and they'll soon see where there is a MAJOR lack of ethic.
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Doug Bennett | 4 Jun 2010 10:39 am
I can see a few comments being attached to this one. When will the FSA act with "Competence and ethics" that is a dichotomy as far as they are concerned.
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Anonymous | 4 Jun 2010 10:43 am
Maybe the FSA should practice what they preach and look at their internal pay structures, the 'old boys network'they operate, the business lunches they have with top bankers on our money, and the blind eye they turn to activities where their 'friends' and other influencial people work.
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Bob Bull | 4 Jun 2010 10:44 am
The information about the salaries of many at the FSA, indicates that 'ethics' applies to the regulated, not the regulator. How on earth can they justify the massive sums paid to 'top people' when our industry struggles to survive?
Ethics? Like Steve says; "Ho Ho"
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Dazed & Confused | 4 Jun 2010 10:46 am
Just had to check the date on this article...for one nasty moment I thought I had suffered an 'Ashes to Ashes' moment and slipped back in time to the 1st April!

The FSA and ethics? Somehow those two words just don't seem to fit in the same sentence!
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Anonymous | 4 Jun 2010 10:46 am
This has been my point all along, you can have as many regulations in place as you like but you will never ever regulate INTEGRITY it is something you have or do not have from what I have seen & coming from HM Forces into Financial Services very little integrity is shown from the banking sector and you have to laugh when you see the FSA building in the middle of pri,me real estate in the heartlands of the financial district of London.. So your telling me they all dont socialise together! Regulater sipping champers with the regulated!
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Gareth Hopkins | 4 Jun 2010 11:00 am
Is this a serious article? Just shows how out of touch the FSA really are. If they want to make the industry ethical they need to remove commission, and start pushing for fee's on financial advice depending on the level of qualification and skill of the advisor, as in accounting and legal professions. That will stop the banks and unethical advisors pushing the wrong products on customers.
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andy leeds | 4 Jun 2010 11:03 am
Just proves someone at the FSA at least has a sense of humour
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joseph | 4 Jun 2010 11:10 am
What an utter load of drum beating!
Give them a round of applause for another round of entertaining hipocritical statement.
Ethics? how does FSA explain the 33% bandit tax hike in Fees?
If a broker does the same, they get shafted.Want to talk ethics, go check out RBS/Natwest, havent heard FSA doing much there (they dont have the balls for it).

Another example, off the industry, SpicerHaart using misleading and customer information in it's advrt - did I hear someone mutter Data protection? ASA have an issue, this in fact is the 6th case happening in less than 2 years.
Where are the regulators here?

FSA and these boys, yes your right they mingle with the crooks, it's time they all go, or otherwise professionals like us will go elsewhere, im getting very annoyed with this quango.
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