The FSA has been granted a new power to deliver prompt and effective redress for consumers as part of April’s Financial Services Act 2010.

The regulator can now require a financial services firm (or a group of firms) to investigate whether, on or after a specific date, it has failed to comply with particular requirements that are applicable to an activity it has been carrying on.

It can also make the firm determine whether the failure has caused (or may cause) loss or damage to consumers and determine what the redress should be in respect of the failure, as well as then make the redress to the consumers.

Sally Dewar, the FSA’s managing director of risk, said: “This is an important new tool for the FSA