The Government has published plans to give more regulatory powers
over financial services advertising to the Treasury.
The Government wants to ’rationalise and modernise’ three separate
regulatory regimes covering insurance, deposits and other financial
services in an attempt to keep pace with new media.
A consultation document issued this week admitted the system was ’under
some pressure’ because of advances in technology and multimedia services
such as the internet.
The proposed changes will be included in the Financial Services and
Markets Bill, which is due to become law next year after the City and
the advertising industry have had a chance to express their views.
The shake-up would give more power to the Treasury to issue exemptions
to the ban on financial marketing, a task that previously fell to the
Financial Services Authority set up last year.
The FSA’s ’targeted enforcement’ of the existing rules covering use of
the internet will also be strengthened.
According to the paper, the ban on financial marketing will be extended
to cover solicited telephone calls made after consumers request
The Treasury argues that these can be just as harmful as unsolicited
The report says the internet offers low-cost channels of advertising for
financial services. The regime will make breaches of the rules ’through
any medium’ a criminal offence.