Peter Williams, IMLA’s executive director, said: “This new consultation paper is welcome because it reveals how the FCA plans to approach its role as a conduct regulator, which is a key component of the new architecture of financial services regulation.
“It is vital the new regulatory system helps rebuild the flourishing mortgage market so necessary for households, the housing market and the economy. IMLA’s aim will now be to engage constructively with the regulator to secure outcomes that work for consumers and firms."
Williams warned that an initial review of the consultation paper suggested the industry "will have concerns over the division of labour across the regulatory landscape, the trade-offs between tighter regulation, innovation and competition, and how the FCA will keep a track of market developments".
He said: "Considerable weight is being placed upon developing a new understanding of consumer attitudes and behaviour, a far from easy task.”
In 2013 the Financial Services Authority will split into two regulatory bodies – the Financial Conduct Authority and the Prudential Regulation Authority.
Today the FSA published proposals for the FCA's new powers, clarified who it will allow to operate as regulated firms and individuals, the standards it expects to be met and the actions it will take if this does not happen.
It outlines the functioning of the new Policy, Risk and Research division which will act as the early warning radar for the FCA and how the FCA will work with the other bodies of what is described as the ‘regulatory family’ and with firms.
And it sets out how it will account for what it does and its measures of success. The document is for consultation and comments are invited by 14 December 2012 with the process backed by a series of engagement events in the preceding months.