‘Consumer is at the heart of regulation’

TÁNAISTE Mary Harney said protection of consumers’ rights was the main driving force behind the setting up of the Irish Financial Services Regulatory Authority.

Launching IFSRA at the neutral venue of the Mansion House in Dublin to stress its independence, the Tánaiste said protection of the consumer would be the fundamental role of the new Financial Services Regulator.

“The consumer is at the heart of financial regulation for the first time, in law, in organisation, in resources,” she said.

Scandals in the banking sector and concerns that consumers are being ripped off for a long time inspired the setting up of the new agency.

In a poll by the new authority it emerged that 71% cited the cost of insurance as a major concern; 58% cited bank charges and the cost of borrowing for personal loans was cited by 47% as a major concern.

Perhaps one of the most disturbing findings of a poll conducted among 1,000 consumers was the fact that 70% did not know where to take their financial complaints while 30% they were not confident their complaints would be properly dealt with.

The new Authority will charge functions previously carried out by the Central Bank, the Department of Enterprise, Trade and Employment, the Office of the Director of Consumer Affairs and the Registrar of Friendly Societies.

It will have control of the regulation of close to 4,000 entities, underpinned by a commitment to ensure adequate protection for the consumer.

The new Authority is part of the new Central Bank and Financial Services Authority of Ireland the new overarching body set up to embrace the new regulatory structures.

John Hurley, Governor of the Central Bank stressed that the main function is that the financial services regulator “will be carried out independently of the Central Bank.

Brian Patterson, chairman of the new authority said good regulation benefited the consumer and was good also for the financial services sector and it would also mean greater competition.

Everything contained in the new authority was designed to enhance the reputation of the Irish financial services industry that, despite its flaws, has been critical to the success of the economy.

The question has been asked, if the Regulator will be a friend of the consumer or a friend of the industry: “That is a false choice. We are a passionate proponent of the public interest and one of our tasks is to interpret where the public interest lies in specific instances”, said Mr Patterson.