Recommendation 184

There was also considerable concern expressed around the way in which the Consumer Duty might interact with the FOS’s rulings. The FCA and FOS’s Call for Input on the redress system acknowledged: “A mass redress event could be triggered by differing views of how the FCA rules apply. Moving to outcomesfocused regulation (like the FCA’s Consumer Duty) has many benefits … However, for these benefits to be fully realised, firms and consumers need to be confident that we have a consistent interpretation of regulatory requirements.” 284 Again, we heard that this uncertainty impacted on the attractiveness of the UK as a place to invest. Sir Howard Davies said that the Consumer Duty: “creates extreme nervousness among overseas investors because they do not know quite what it means. … It all seems, in a way, quite sensible when you discuss it with the FCA, but then you have the ombudsman, and the record shows that the ombudsman produces judgments that sometimes go well beyond what the FCA recommended.” 285