In an interview with the Financial Times, Mark Hoban, the financial secretary to the Treasury, says the government will outline its proposal to strengthen a planned consumer champion and two other regulators.
The CPMA, which is to be renamed the Financial Conduct Authority, will be able to ban products or limit their distribution for up to 12 months, it will also have the power to reveal which banks, brokers and individuals it is investigating before action is take.
It will also be given a remit to cultivate competition in a bid to improve market efficiency and consumer confidence.
In the interview with the FT, Hoban says: “It is a radical reform but the lesson of the financial crisis is that you need to have proper focus and clear mandates and the mandates need to be underpinned by the powers to do the job.”
He adds the organisation has been renamed to emphasise its role as a conduct body, with the government keen to highlight the new focus on the way banks, brokers and individuals behave.
In the consultation paper released today, it says: “The FCA will have a fundamentally different approach to that of the FSA in the way it intervenes to mitigate risk financial services.
“The FCA will have a lower risk appetite for issues affecting a whole sector, sub-sector or type of product – it will be less prepared to see detriment actually occur, instead seeking to act in a more preventative manner.
“This will entail, for example, proactively intervening earlier in a product’s life cycle, with greater scrutiny of firms’ product design and product governance complementing the traditional focus on sales and marketing, and the disclosure of information.”