Key Post Central Bank launching a review of the Consumer Protection Code today

[Brendan Burgess]

Hi Duke

But imagine that heroin was not illegal or banned.

Then the Central Bank would be quite happy with it as long as it's not mis-sold.

Brendan

 

[Duke of Marmalade]

Hi Duke

But imagine that heroin was not illegal or banned.

Then the Central Bank would be quite happy with it as long as it's not mis-sold.

Brendan

Fair comment. To a certain extent I think that should be the only remit of not only the Central Bank but of the State in general. By mis-sold I mean in the sense of being sold under false pretenses or in the case of some RSPs with total lack of understanding of what exactly it is that the investors are buying.
There are many legal products which a large section of the population think anathema that anyone should be buying them, but it's a free country and as long as people know what they are buying Nanny should not stop them.
Take cigarettes. Many people, the majority, think they are a foul product. But a minority want the product. Now there was a time when far more people smoked cigarettes, mostly unaware of its health damage and also possibly misled by advertising as to its macho image. The correct approach followed by the State was to totally eradicate this misinformation and replace it with correct information. The Central Bank has full powers to do this for RSPs; simply enforce the MiFID requirement to be fair, clear and not misleading - that removes the misinformation - but also to follow the ESMA Opinion which would force providers and distributors to give the full information. But for some reason they fail to take this obvious step; instead let's have some fun by getting all these fools playing our consultation tune.

 

[Brendan Burgess]

But the government banned advertising of cigarettes.

Let's say BCP did a full and frank document without the backtesting.

Brokers would still sell it to people who could not understand the product.

That is why I don't think that such products should be allowed.

And I think that the government is right to make the possession of and dealing in heroin illegal.

Brendan

 

[Duke of Marmalade]

But the government banned advertising of cigarettes.

Let's say BCP did a full and frank document without the backtesting.

Brokers would still sell it to people who could not understand the product.

That is why I don't think that such products should be allowed.

And I think that the government is right to make the possession of and dealing in heroin illegal.

Brendan

Of course the idea of product approval is not totally off the wall but our system has spurned that route and I broadly agree with that. For a start it would be a substantial overhead for the Central Bank to take on. But more fundamentally the assessment involved in deciding that there is no target market for which a particular product is appropriate is highly subjective. By contrast there is really little subjectivity in assessing whether the marketing of a product is fair, clear and not misleading.
The full and frank document I have in mind for some of the RSPs that I have seen would ensure that anyone who reads the brochure and still enters into the proposition, does so in full knowledge of what they are doing - that's their call. I don't think that the fact there are wicked women who would get round even that situation should decide overall policy.
Agree with you on heroin.