Consumer Panel response to Legal and General vs FSA Judgement

18 January

The Consumer Panel today welcomed the Tribunal* decision that upheld the FSA's case that L&G's sales procedures were defective and that "these procedural defects will have caused or contributed to mis-sales".

The Panel is pleased also to see the FSA being encouraged to use its powers more forcefully to obtain the evidence they need to check up on potential mis-selling by financial services firms.

Ann Foster, Chairman of the Consumer Panel said:

" The most important finding is that 41,000 L&G Flexible Mortgage Plans were sold between 1997 and 1999. As the Tribunal found that L&G's sales procedures were defective, it is imperative that L&G review those sales to ascertain how many were missold, and compensate consumers accordingly."

* Financial Services and Markets Tribunal Notes to editors

1. The FSA established the independent Financial Services Consumer Panel in December 1998 to advise its Board on the interests and concerns of consumers and to report on the FSA’s performance in meeting its objectives. The Consumer Panel has statutory status. The FSA must consider its representations and, if it disagrees with a view expressed or proposal made in the representation, it must give the Panel a statement in writing of its reasons for disagreeing.

2. The emphasis of the Panel’s work is on activities that are regulated by the FSA, although it may also look at the impact on consumers of activities outside but related to the FSA’s remit.

3. Consumer Panel brings together a wide range of relevant experience. This includes financial services regulation, working with vulnerable consumers, consumer protection, consumer education, front-line money advice, legal expertise, competition policy, public policy analysis, market research and media.

4. There are currently fifteen members of the Panel as listed below. For further information on individual members, see About the Panel.

   Ann Foster (Chairman)
   Dianne Hayter (Vice Chairman)
   Yvonne Gallacher
   Harriet Hall
   John Howard
   Tony Hetherington
   Stephen Locke
   Nick Lord
   

   Nick Pearson
   Adam Phillips
   Paul Salvidge
   Robert Skinner
   Carol Stewart
   Richard Smethurst
   Dave Watts