Jury still out on the FCA

The FCA's appearance at the recent British Insurance Brokers' Association (Biba) conference provided a glimpse of what brokers should expect, although a lot of what was said by CEO Martin Wheatley was admittedly similar to the rhetoric already reported by the business press over the past 12 months.

Warnings that firms must get their "houses in order" were also accompanied by admissions that the new regulator will tackle problems at birth rather than later down the line to prevent similar scandals such as PPI occurring.

Furthermore, earlier this month the Financial Times reported that the regulator had begun probing the London offices of banking and asset manager giants in a bid to ensure the interests of retail fund investors and pensioners were being served.

Such messages have served to heighten interest among the financial press and regulation experts that the FCA really will mean business for brokers and insurers.

Indeed, a recent blog post by broker compliance expert Terence Clark, of RWA Group, commented: "The FCA will be much more visible with greater powers, (including as we have said previously the power to ban products and withdraw financial promotions) and will have an increased appetite for enforcement where it is deserved.

"Rest assured, it will be a regulator that will not be afraid to use these powers if it finds any abuse in the market."

Rebrand
Nevertheless, it would appear that the people that really matter in all this, brokers, are yet to be convinced about the recent warnings.

For a recent survey conducted by compliance firm UKGI found that three quarters of brokers believe the switch to the FCA will prove to be just a rebrand.

And some 21% believe that the FCA would have no impact at all on the industry. It seems that brokers remain cynical about the new regulator's likely impact.

What's more, only last month, Insurance Age's Sentiment Survey found that 51.6% of broker fear the FCA would only result in more costly regulation, with 35.5% warning it would lead to more bureaucracy.

And in terms of getting a positive message across to the market, just 4.8% of brokers surveyed said it would result in better opportunities for dialogue.

Proactive
Personally, I would commend the FCA for its proactive approach over the last year in trying to get its message across in terms of ensuring that customers' best interests are always at the heart of any products sold or advice given.

Yet it must also be remembered that when the Financial Services Authority was established back in 2001, it did so with similar rhetoric about a "proactive" approach to regulation.

Indeed, with the new regulator still shy of its two-month birthday, it is still exceptionally early to judge its impact.

However, despite the column inches devoted to its new stance, the FCA would appear to have its work cut out to convince brokers it will indeed deliver positive change for the profession.