Product sales data
The FSA proposes to collect information from product providers on a quarterly basis. The products covered will include mortgages, life policies, general insurance, collective investment schemes and SCARPS (structured capital-at-risk products, such as precipice bonds). Information will be submitted electronically, to minimise cost to firms, and must cover both direct sales and those made via intermediaries. Among the details required will be:
- The type of product sold
- Whether the sale was advised or non-advised
- (For mortgages,) property and loan value, buyers' status and repayment method
All retail firms, such as Independent Financial Advisers and mortgage and insurance brokers, will be asked for information about their financial resources, complaints received, training and competence and other matters. The FSA proposes that this information is submitted electronically and on a half-yearly basis for the majority of firms.
Sarah Wilson, Director of the FSA's High Street Firms Division, said: "Focusing our resources on the areas that pose the greatest risk is central to the FSA's approach to regulation. To do that effectively, we need to have a clear picture of who is selling what products to whom. That way, we can spot and address potential problems at an early stage.
"The advent of mortgage and general insurance regulation has given us the opportunity to start with a blank sheet of paper and determine exactly what information we need from regulated firms. We have taken the opportunity to review the information we require from IFAs, as well as from mortgage and general insurance firms. The end result is that we propose to require one set of information from all intermediaries. We are aware that collection of data itself imposes costs on firms and will be keen during consultation to understand whether we have accurately estimated those costs. We propose to harness technology to reduce the reporting burden on all firms as far as possible.
"Accurate, timely information will make the FSA a smarter regulator."
The proposals are set out in Consultation Paper 197 , Reporting requirements for mortgage, insurance and investment firms & supplementary consultation on audit requirements. In addition, the FSA has today published a wider paper on regulatory reporting Consultation Paper 198 Regulatory Reporting - A New Integrated Approach. Responses to the Consultation Papers are requested by 11 December 2003. The FSA expects to publish feedback, together with near final rules in March 2004.
Background
- The new reporting framework is described in Consultation Paper 198 Regulatory Reporting - A New Integrated Approach, published today. Consultation Paper 197 specifically covers the introduction of a new system for regulated retail activities including the new mortgage and general insurance activities and mortgage lending and administration. Both are available on the website at http://www.fsa.gov.uk/pubs/cp/197 and http://www.fsa.gov.uk/pubs/cp/198.
- CP 198 also contains feedback to FSA Discussion paper 12 The new regulatory reporting environment which was published in May 2002.
- The FSA regulates the financial services industry and has four objectives under the Financial Services and Markets Act 2000: maintaining market confidence; promoting public understanding of the financial system; securing the appropriate degree of protection of consumers; and fighting financial crime.
- The FSA aims to maintain efficient, orderly and clean financial markets and help retail consumers achieve a fair deal.
