Martin Wheatley, head of the new Financial Conduct Authority, which will emerge next year from the ashes of the Financial Services Authority, is making all the right noises. He promises a more interventionist approach to stop future mis-selling scandals. ‘We will work more closely with firms to make sure the products they design go through a real testing process and serve a real purpose,’ he says. ‘When we start to hear of problems with a product, we will go in much earlier than in the past. ‘The watchword for the new institution will be more intensive supervision. We will be looking at things from a consumer perspective, rather than from an industry perspective.’

Fine words. If a more interventionist approach had been adopted in the past on the design and value of financial products, a whole string of mis-selling scandals – from precipice bonds to payment protection insurance – would have been nipped in the bud. As my colleague Richard Dyson reports on Pages 84-85, PPI remains the biggest scandal because of the FSA’s failure years ago to realise the product’s design was horribly flawed and the value to consumers negligible. Now, a mis-selling scandal of monumental proportions has developed into a compensation fiasco of equally epic scale. The banks, especially Lloyds and Barclays, should be pilloried for their gross incompetence, especially those executives responsible for.....Read more here--: JEFF PRESTRIDGE: New Financial Conduct Authority must deliver on fine words