“Justice should never be an obstacle to growth. But neither should growth be a justification for erasing justice.”
Yesterday’s report from the House of Lords Financial Services Regulation Committee confirms what many of us have suspected: consumer advocacy is once again under threat—not by accident, but by design.
In a sweeping call for reform, the Lords argue that the Financial Ombudsman Service (FOS) has overstepped its bounds by acting as a “quasi-regulator”. Their core complaint? That the FOS dares to deliver redress to victims in a way that challenges the Financial Conduct Authority’s (FCA) pro-growth orthodoxy. Translation: the FOS has become too effective in holding the industry to account.
This isn’t a debate about bureaucracy or balance—it’s a power play. The financial elite want a neutered FOS, one that doesn’t disrupt the Mansion House Accord’s grand vision of turning Britain into the next global capital of deregulated finance. But when the House of Lords starts painting consumer protection as a drag on international investment, we must ask: whose growth are they really defending?
The Real Risk Premium: Justice
According to the Lords, the FOS’s decisions—especially in mass redress cases—create “regulatory ambiguity” that supposedly deters investment. They warn of a “risk premium” on UK financial firms, driven by the fear that following FCA rules may still leave firms exposed to retrospective claims.
Let’s unpack that.
If complying with regulation still leaves a firm at risk, perhaps the problem isn’t the Ombudsman—it’s the rules themselves. Or rather, the absence of them. Because while the FCA focuses on enabling innovation and market expansion, the FOS has become the last line of defence for those who suffer the consequences of mis-selling, negligence, or outright fraud.
Consumers don’t care whether it’s the FCA or the FOS that delivers justice. They care that someone does. The Lords’ concern isn’t uncertainty—it’s accountability. And they want less of it.
Back to Basics or Back to Business as Usual?
Among the committee’s recommendations are:
- Stripping the FOS of any precedent-setting influence;
- Forcing it to pause cases until the FCA provides guidance (read: permission);
- Legislating it back into a box labelled “informal dispute resolution.”
But informal doesn’t mean ineffective. The FOS was always meant to be a consumer-first body—free from industry capture, quick, accessible, and responsive. To neuter its power now is to signal that the protection of consumers is secondary to the appeasement of markets.
This is not about reform. This is about retribution.
The Bigger Picture: A Regulatory Race to the Bottom
The Lords’ report doesn’t stop at the FOS. It targets the very framework of the FCA’s Consumer Duty—claiming it’s too vague, too burdensome, and too risky for firms navigating uncertain regulatory terrain. Their solution? Streamline, simplify, de-risk.
But in simplifying the rulebook for firms, we risk complicating life for consumers. Again.
This is the same old story dressed in new language: cut red tape, boost confidence, attract capital. But we’ve heard this before. We know what happens when regulators get cosy with industry and deaf to citizens. The 2008 crisis. The British Steel Pension scandal. The endless wave of financial crime victims now left to crowdfund legal redress because the system was designed to fail them.
What Now?
The Lords may wish to see the FOS relegated to a powerless postbox for grievances—but the real issue is not its overreach. It’s the underperformance of every other mechanism of financial justice.
If the FCA had provided clear, consistent, consumer-focused rules in the first place, the FOS wouldn’t be stepping in to fill the vacuum.
This moment demands more than technical debate. It demands moral clarity.
Are we building a financial system that serves society—or a society that serves the financial system?
At the Academy of Life Planning, we know which side we’re on. And we’ll continue to speak up for those who are silenced, sidelined, or sacrificed in the name of growth.
Steve Conley
Founder, Academy of Life Planning
Leader, Get SAFE Initiative
Advocate for Financial Justice | Peer Mentor | Former Industry Insider
About Get SAFE
Get SAFE (Support After Financial Exploitation) was born from a simple truth: too many victims of financial abuse are left to suffer in silence.
We exist in memory of Ian Davis—for the ones who did everything right, only to be failed by the systems they trusted. We know that behind every vanished pension, every ignored complaint, and every stonewalled letter is a person—frightened, exhausted, and too often alone.
Get SAFE offers more than sympathy. We offer structure, support, and solidarity.
We provide a voice where there’s been silence, and clarity where there’s been confusion.
We stand beside those who have been exploited, not just to help them recover—but to help them reclaim their story and rebuild their future.
Because financial justice is not a luxury.
It’s a human right.
If you or someone you know has been affected by financial exploitation, we are here.
You are not alone.
Learn more at: Get SAFE (Support After Financial Exploitation).
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