FSA to put financial sales in the spotlight

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The City watchdog yesterday said it planned fresh investigations into the way financial salesmen are paid.

The Financial Services Authority said the way people who sell financial products are incentivised was one of five key themes to be investigated as part of a sweeping review of how the products are sold.

Clive Briault, the FSA's managing director of retail markets, said in a speech: "We need to ask some hard-hitting questions about the structure of this market. Such as: 'Will it always lead to adverse behaviour by some to the detriment of others?'."

The industry has been plagued by scandals over the years, notably on pension and endowment mis-selling. There are concerns that these have contributed to the £27bn UK savings gap.

The other areas the FSA plans to focus on are the industry's professionalism and reputation, consumer access to financial products, whether the regulator actually creates barriers to consumers, and the sustainability of the sector.

A spokesman for the life insurer Aegon said: "The existing system does serve a lot of people very well, but no one is saying it is perfect."