Consumer protection in relation to personal finance

Question 1

Financial Conduct Authority(FCA)

Answer 1

The FCA is an independent organisation that is the conduct regulator for 59,000 financial service firms and financial markets in the UK. It is funded via fees charged to the financial services providers and their work focuses on 3 key areas:
- authorisation - permitting financial service providers to trade.
- supervision - ensuring procedures and practices are in interest of the consumer.
- enforcement - using powers to ensure standards are maintained

Question 2

Financial Ombudsmen service(FOS)

Answer 2

Appointed by the government to protect and represent consumers who are in disputes with financial service providers. It is funded by the compulsory fees charged to all regulated financial institutions. They only get involved if these disputes cannot be settled between the financial provider and the consumer.

Question 3

Financial services compensation scheme(FSCS)

Answer 3

An organisation that pays compensation to consumers when the financial service provider is unable to. Protects savers up to £85,000 if the institution goes bankrupt and the saver will be compensated by the FSCS.

Question 4

Legislation: Consumer credit

Answer 4

Laws that have been passed to regulate any business offering credit to consumers. The laws are passed by the UK government to ensure consumers are protected and that their providers do not take advantage.

Question 5

Office of Fair Trading(OFT)

Answer 5

Is an government organisation that was established to regulate all markets including financial markets. The OFTs aim was to encourage fair practices and healthy competition between financial institutions.
Since 2014 responsibility for financial institutions has been passed to the FCA.