Sants pledges to move away from reactive regulatory model

Rise. Sir Hector!

Twin Peaks? Quite an apt description - that TV series was somewhat bizarre & surreal as well......not dissimilar to regulation over the recent past.

Oh I see!. Now Hector's explained it, I wondered why everything had improved so much at the FSA since he took over.

Doh!

Can we have an English version of this article please ?

Wasn't 'Twin Peaks' a rather second rate 80s TV show? what does Hector mean by Twin Peaks? Is it about creating an environment where consumers can get affordable quality advice when and where they need it?

This is almost certainly a REACTION to the criticism he recently received from members of the TSC over the RBS debacle and the role played (or, rather, not played) by the FSA. He took no responsibility for what happened, but apportioned blame on everyone else.

He has still not given a reply to the TSC's request to delay RDR implementation by 12 months, which he promised by the end of September 2011, and will no doubt blame everyone else for his tardiness !!!

When will someone in authority see through his veneer?

*Insert generic, ill informed, obstructive comment here*

Twin Peaks? Ornithologically speaking that'll be a couple of tits then.

Nuff said

If memory serves, it was barely nine months ago that victims of the Barclays/Aviva mass mis-selling debacle had to demonstrate outside Parliament in a desperate attempt to get the FSA to react to the slew of complaints being raised about how Barclays was fobbing off virtually everyone who'd complained about how they'd been mis-advised.

On the strength of this, it appears that the FSA doesn't even do reactive regulation very well and, when it does react, the outcome generally seems to be that it's all the fault of the IFA community (e. g. KeyData the provider somehow or other classified as an intermediary), so it's us who have to pay to clean up the mess.

As for light touch regulation ~ what you mean, Hector, is EXTREMELY SELECTIVE light touch regulation.

As for arrow visits ~ Wot, like the one the FSA carried out on KeyData back in 2007 and took no action on the concerns raised at that visit, resulting in yet another motorway pile-up that the FSA is supposed to have averted?

The mildest term I can think of for this latest speech is HOGWASH.

Hector Sants has criticised the regulator’s old reactive style "

Who was in charge when that was going on ?

errrrrrrr Oh Yes it Was Hector Santsa

And now he wants Judgement based supervision??

Now that sounds like a Kangaroo Court in waiting

Incredible..... the arrogance of the man continues unabated

And with one bound Jack was free..............................(or was that Hector?)

That what £600,000 buys you !

@Stratfield - Obviously you have nothing else to do but watch the birds feeding outside your office window. Your humour made my day!

The biggest favour this character can do for the safeguard of the financial services industry and its clients is to immediately emigrate to the land of the dictators, then Britain will once again be a place where clients, providers and advisers can live with optimism that they will be respected once again.

@Bob

It's no laughing matter looking out of my window I can tell you ! Why, only this morning, I spotted a little wren (readers will note that she is one of the smallest British birds) flitting happily in and out of the hedgerow looking for somewhere to build a little nest for herself. Nothing flash mind you, just a tiny little nest where she could do well, when along came a couple of tits. Great tits I believe, with a bad attitude and utterly ill informed. They harrassed little Jenny Wren all morning, but Jenny hid carefully and the tits went away.

However this afternoon a great big tractor came along with a big noisy machine thing that cut the hedge to the ground, and later on the tits came back and danced all along where the hedge had been and sang their little heads off.

I haven't seen the wren since

Hey ho

Stratfield - what a fantastic analogy of yours. Very funny.

However, you have to be careful that the tits weren't actually surrounded by robins.

As in, Robin' ba*****ds.

Glad to see that Sir Hector (sic) is starting to warm up the spin ready to justify a massive hike in the FCA budget and his salary and bonus.

By the time they all realise he is rubbish at his job, it will be too late, IFAs will have gone the way of the DODO and he will then get a directorship with a leading state owned bank.

Call me sinical, but after 30 + years in this industry I have seen too many timesa the Old boys club in action.

Was not the EQuitable life sales force passed over to the Halifax ? that would help to explain the later arrogant sales techiques of the halifax and later downfall

It's like John Major's ' Back to Basics' slogan. We all knew it would end in tears.

Now we get that 'Peak' sants talking 'Twin Peaks'; It's bound to go Peaks up.

It begs the question, if sant is one of the 'peaks', who is the other?

Answers, ladies and gentlemen please.

The longer, louder and more positively a person insists that they are right the more people will believe them - that is well established psychology. The less credible the statement the greater the level of belief, probably because the listener cannot fathom out the statement (well you can't if its wrong) but does not wish to look foolish.

It rather looks as though Sants does have ability to convince, even when what he says is totally barking. The really bizarre aspect is that it is hardly Treating Clients Fairly. I'm sure I read something somewhere about being ethical - possible I just dreamt it.

Reactive regulatory MODEL? You mean there's actually been a strategy the whole time? News to me...

Errr!

'Scuse me?

Who is it who has been running the malicious unaccountable organisation for the past few years ?

Errr!

Oh yes - Hector Sants

And this is the guy who is being appointed Deputy Governor of the Bank of England?

You could not make this stuff up, our countries worst nightmares are about to get worse, an incompetent head of regulation, being put in a position of authority in the Bank of England. Incredible.

Sants is incompetent and put simply - evil.

This is the man who - with his cohort Tuner - presided over the worst regulatatory failure in modern day history and yet he is still in the industry. Worse he is still in a postion to make this sort of rubbish announcement.

Is this really the best person the UK Finacial Services industry can produce to head up a national regulatory body!! His track record shows he is even less competent than Fred Goodwin.

Everyone in the industry needs to stand up, let their views be known and lobby for a replacement as a matter of urgency.

Sants is not evil, he is at the head of a regulator, who as a "collective" body, has demonstrated time and time again it is not fit for2 main the purposes it was set up for.

1. Maintain confidence in the Financial System

2. Protection of Consumers

Describing him as "evil" is not really true, he may be incompetent, dillusional as to his own infallability, lacking in moral fibre to do the right thing for this industry, wasteful of our hard earned fee income which they can hike up at any time, unaccountable, unelected, is completely immune from prosecution for its recklessly negligent mis handling of the issues it is supposed to be handling, has implemented changes (RDR) which quite frankly as can be seen by the various comments here and elsewhere, were never supported by the majority of the industry providers or intermediaries and which will disadvantage mllions of ordinary consumers by putting the advice services of IFAs out of reach and unaffordable.

The budget of the FSA has risen inexorably and without any controls as to how they spend our money and without any accountability.

No, not evil, but the organisation as a collective body he controls is no longer fit to serve the needs of the industry and the public.

Wealthy People will always be able to pay for full advice from qualified professionals, ordinary people will just have to like it or lump it. Fee levels will inevitably be set between £150 - £250 post RDR as we are already seeing them rise now to cope with all the extra levies we are charged.

Under the English Bill of Rights 1686 it says that no fines or forfeitures are permitted without trial in a court of law.

Clearly the levies raised by FSCS may contradict the law and be unenforceable.

As for FSA fees, financial services is a closed shop no choices.

@P A Williams

"Everyone in the industry needs to stand up, let their views be known and lobby for a replacement as a matter of urgency. "

I propose that Harry Redknapp be approached and offered whatever it takes to obtain his services. Although he admits to being financially and technologically illiterate he has proven his honesty in a court of law.

A bit like Hector then but with one important difference.

@ Stratfield.

I like the football analogy. To continue the theme, it occurred to me quite a while ago that Hector Sants is the FSA's equivalent of Sepp Blatter of FIFA.

Twins peaks puts me in mind of a military maneuver, the pincer maneuver where the enemy is approached from both sides and defeated - is that what he was eluding to?

I hear a song from a time honoured sitcom coming on "who do you think you are kidding Mr Hector, if you think we're on the run" - you can finish the rest yourselves. All together now after all st of us are in the same age bracket.

Adding to my earlier comments on the FSA's numerous failures to take action on information already in its possession (e.g. the findings of its 2007 arrow visit to KeyData and Barclays' systematic programme of fobbing off complaints about the consequences of its mass mis-selling of those two Aviva funds), we also frequently read reports from IFA's who've reported to the FSA dodgy activities of one sort or another, yet on which the FSA has failed totally to take any action.

What Hector Sants appears to be saying is that the FSA has tried reactive regulation but, in the light of the numerous motorway pile-ups that might well have been averted, it's come to the dazzlingly enlightened realisation that it doesn't work. So now, instead, it's proposing to have a bash at predictive regulation which, as usual, is likely to be hugely expensive and hugely burdensome in terms of the amounts of additional data that practitioner firms will be required to submit.

Mr Sants ~ What renders reactive regulation unworkable isn't the system itself. Rather, it's the FSA's failure to react! Not only are there a slew of examples to support this conclusion, but the FSA seems (as usual) to have chosen to interpret the evidence in such a way to deflect blame from itself. It's not us who're at fault ~ it's the methodology. Ah yes, of course. How can we have ever doubted the omnipotent and omniscient FSA?

Still, never mind, let's throw a few tens of millions of pounds of OPM at yet another new system of regulation and maybe this time we'll get it right. As ever:-

The Regulators’ Compliance Code (from which the FSA has granted itself a unilateral and total opt-out) is a central part of the Government’s better regulation agenda. Its aim is to embed a risk-based, proportionate and targeted approach to regulatory inspection and enforcement among the regulators it applies to.

Our expectation is that as regulators integrate the Code’s standards into their regulatory culture and processes, they will become more efficient and effective in their work. They will be able to use their resources in a way that gets the most value out of the effort that they make, whilst delivering significant benefits to low risk and compliant businesses through better-focused inspection activity, increased use of advice for businesses, and lower compliance costs.

How we wish.

Julian: there is a problem with your first paragraph in that most information is interpreted better in the light of history. There are innumerable instances of questions being asked as to why things were not anticipated in the light of known intelligence (read the history of the lead up to Pearl Harbour). The problem is sorting the relevant intelligence from the irrelevant intelligence at the time it is acquired.

If the Stockmarket had not crashed; if the investors had gone in a couple of years earlier, to get some very solid growth under their belts then I strongly surmise that the Barclays/Aviva complaint would never have happened; those pensioners may now be eulogising Barclays in a parallel universe. If the US Government had bailed out Lehman's we wouldn't be where we are - and where we would be is a forever unknown.

And that is the problem with "reactive" regulation - you are steering by looking out of the back window. What is additionally frustrating is that new crises tend to be different to old crises. It is possible to learn from old crises, but there is no certainty one has learnt the right lesson until the test comes along.

Which then raises a question about Sants statement. If "prediction is extremely difficult, especially when its about the future" (Niels Bohr), what is the point of forward-looking, proactive, judgement based supervision?

There are tomes of research that demonstrate that we are no better than random when predicting the future - so how does forward-looking help? Until we are in the future we have little understanding of what was important in the past. Can you say you would have foreseen the phenomenal take-off of the iPad, which is still not 2 years old, and which is already altering behaviour patterns.

Pro-Active is a fancier term for reactive - we've already dismissed that.

Judgement based supervision from the Company that brought you such block-Busters as "Equitable Life - The Crash", "Northern Rock - The Crash", "RBS - yawn, etc. I'm really looking forward to this vehicle.

So while I said there was a problem with your first paragraph, I have come to the conclusion that there is a problem with Mr Sants' total business strategy. It is based on highly successful control of the financial system. Now if you think that one through you should come to the same conclusion as myself - he should be in a place where they only let your write with soft crayons. The fact that he is taken seriously by so many other people suggests that the people who are translating their wealth into gold may have an excellent appreciation of the damage the current regulators could do to the system. It is too soon to really know, but there appears to be a correlation between the destructive force of a financial crash and the length of time regulators have been in power.

There is one thing that Mr Sants has learnt well from his time in the FSA - you don't really need to change anything, except the story you tell to the Press in order to be successful.