FSA Didn’t Use Mystery Shoppers Since 2010, BBC Reports

Jack Humphrey, Regulatory journalist
January 12, 2012 /

The Financial Services Authority in UK has admitted that no mystery shopping exercises had been carried out for almost two years to protect consumers, BBC reported.

The report followed a Freedom Of Information request submitted by the BBC to the FSA, revealing that the UK financial regulator did not use mystery shoppers since March 2010, during which time FSA chief, Hector Sants, said the agency would make more use of mystery shopping and onsite visits. The announcement came amid widespread concern at the mis-selling of payment protection insurance.

The FSA replied to BBC’s report, saying it was a tactic used “in the right circumstances”.

“It is a little surprising that the FSA hasn’t placed more of an emphasis on mystery shopping, which can be a useful tool in identifying consumer detriment,” said Sarah Brooks, director of financial services at Consumer Focus, as quoted by BBC news.

“We accept that mystery shopping may not provide the hard evidence needed for enforcement action. However, it can act like a canary in a mineshaft – an indicator of problems.”

“Mystery shopping is just one way the FSA can spot poor practice in the market place. It remains a tactic that we will use in the right circumstances,” BBC reported, quoting an FSA spokesperson.

 

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