Financial Services Authority ( Pra ), Financial Conduct Authority

1367 Words Dec 3rd, 2014 6 Pages
This essay will discuss: why financial services need regulated in the United Kingdom, Prudential Regulation Authority (PRA), Financial Conduct Authority (FCA), Financial Services Authority (FSA) and a short comparison between the old regulator and the new one. The main areas this essay will comment on will be why regulation is needed and the current regulators the PRA and FCA. It will also discuss the extent to which regulators protect consumers of the United Kingdom financial system. Regulation is defined as “The imposition by a government of controls over the decisions of individuals or firms. It often refers to the control of industries in which there is monopoly or oligopoly.” (Oxford, 2008)

The need for regulation in Financial Services is crucial because if there were no regulation there would be free reign of the Financial Services industry. This could lead to industry wide corruption of a scale would be catastrophic to the global economic system. Regulation is critical to prevent the Financial Services industry from self-destructing. In reality, the previous regulator the FSA had the view of level of protection it should provide; help in identifying, reducing prudential risk, bad faith risk and other types of unsuitability risk. Thus, it should have no responsibility to protect consumers from performance risk, which is inherent in all investment markets. (RFS, 2014)

Objective-led Financial Regulation - The statutory objectives have been used as a way of setting out…

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