The Financial Services Consumer Panel today called on the Financial Services Authority (FSA) not to weaken consumer protection rules for selling the Government's proposed 'stakeholder' investment products. This is in response to the FSA's announcement that it is to undertake consumer testing to see how effective 'guided self-help and warnings' (the second of the broad options outlined in FSA Discussion Paper 19) can be in regulating the sale of the Government's proposed products.

The Treasury today confirmed that the stakeholder suite of products will include a medium term investment product with up to 60% of the customer's money exposed to the stock market. The Panel is concerned about the potential for mis-selling if the sales and advice regulations are relaxed.

Colin Brown, Chairman of the Panel, said "These investment products will be aimed at customers who are least likely to understand them. We are calling on the FSA to make a firm stand for consumer protection. The suitability rules should stay."

The Panel acknowledges that the FSA has not yet taken any decisions on the differentiated regime or on what lower risk products could be sold through it. However, the direction of the FSA's further work points towards a relaxation of the rules and the Panel is deeply disappointed in this.

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Notes to editors