Bailey told MPs at a Treasury select committee hearing this month that the UK regulator is yet to take enforcement action against any investment firm over Mifid II breaches.
Miller, co-founder of wealth manager SCM Direct, said the FCA is failing in its statutory strategic objective to ensure markets function well. It is also failing to ensure consumer protection, integrity and competition, part of its operational objectives.
She is particularly concerned about Article 24, which requires companies to disclose 100% of their costs and charges to consumers. Hidden charges are costing UK investors £903m per year, according to SCM Direct calculations.
“The buck has to stop somewhere and I suggest it is at Mr Bailey’s door,” she said. “Culture comes from the top, and the FCA’s culture under Mr Bailey appears to be capitulation to the very industry it is meant to regulate. It is time for him to ensure the FCA properly regulates the UK investment industry, or else resign.”
Bailey told Treasury select committee chair Nicky Morgan at a public hearing on Thursday that there had been no enforcement actions against firms over Mifid II breaches. “We have been focused on supervisory action,” he said.
In Q1 2019, the FCA will be publishing findings on how firms calculate and disclose transaction costs and how effective overall cost disclosures are.
In response to Miller’s comments, an FCA spokesperson said: “As yet, no firm has been referred to enforcement for a breach of the relevant rules. We are focused on supervisory action and have conducted a substantial amount of work in this area, including to understand and clarify our requirements and how effectively they have been implemented. Where necessary, we have already sought improvements.”