FCA bosses on the backfoot as they are taken to task over fraud

Bosses at the City regulator have been forced to defend their actions as they were taken to task over issues ranging from the Woodford scandal to fraud scams.

The annual public meeting of the Financial Conduct Authority (FCA) came at a time when it is keen to show it is flexing its muscles to protect consumers during the cost of living squeeze.

But yesterday’s event, led by FCA chairman Ashley Alder and senior executives at the watchdog, saw them confronted by questions from the public and press about whether their actions went far enough.

The Mail’s ‘Stop the Social Media Scammers’ campaign has highlighted how fraudsters using online platforms are driving an online crime wave with one Briton falling victim to a shopping scam every seven minutes.

Asked about the FCA’s response, Alder denied that the watchdog had ‘failed’.

‘All regulators when faced with the level and sophistication of scams can do better,’ he said. ‘But doing better means attacking the issue across a very broad front.

‘We have not eliminated all scams – that would be impossible to do.’

But Alder said the FCA had been active in areas such as taking down fraudulent websites, its ‘scam smart’ awareness campaign and work with banks to address so-called push payment fraud, where consumers are tricked into transferring money to scammers.

Therese Chambers, joint executive director of enforcement, said big tech companies ought to be playing a role fighting against fraud and that after working with Google, it was now taking down advertising from potential scammers.

The regulator was also confronted over its response to the collapse of Neil Woodford’s flagship investment fund in June 2019, which will see investors who were left in the lurch start to receive a £230million compensation package from next year if they agree to a settlement.

Alder said ‘quite a few questions’, which were submitted online, were about what he described as the ‘Woodford saga’.

One asked ‘are the FCA not looking after the interests of Woodford investors?’, and suggested court action would be a better alternative to the proposed scheme.

Chambers insisted that ‘the interests of the Woodford investors are absolutely our top priority’.

She reiterated the FCA’s view that the settlement – from Link, parent company of the fund’s supervisor Link Fund Solutions – offers ‘the quickest and best chance to obtain a better outcome’.

Also during the meeting, Alder said that the FCA’s main role in policing the financial sector would not be diminished by a duty that has now been placed on it, under new legislation, to help boost the UK’s international competitiveness.

‘There will be no race to the bottom,’ he said.