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The head of Britain’s financial watchdog has called on politicians to define an acceptable level of harm for consumers, as he warned more could “go wrong” due to Sir Keir Starmer’s demands to cut regulation.
Nikhil Rathi, chief executive of the Financial Conduct Authority, said on Wednesday that his recent proposal to relax controls on mortgage lending would increase defaults and home repossessions.
“In the field of mortgages, there will be more defaults if we relax [rules]” he told the House of Lords Financial Regulation Committee. “One or two things will go wrong here and not everyone will fully adhere to the rules, and will that be accepted?”
The FCA has also proposed relaxing requirements on banks to check customer identities to block money laundering on smaller transactions, after the Prime Minister called on regulators to propose rule changes to curb risk-taking and investment in the stagnant British economy.
But Rathi said the change risked leading to an increase in fraud and warned that “there could be more money mules coming through the system”.
This is a development story