FSA mulls price intervention

LONDON (Reuters) - Some financial products may be too complex and the prices of others may need regulating to protect investors, the market watchdog said Tuesday.

Adair Turner, chairman of the Financial Services Authority, said radical questions need to be asked about how financial markets function and how consumers should be protected as regulators apply lessons from the financial crisis.

"Are some products too complex to be sold to consumers at all?," Turner said in a speech to the FSA's Financial Capability conference dinner.

"Should we be prepared to intervene on pricing, even at the expense of access to the market for some people?" he added.

Turner called for twinning consumer protection with educating consumers about financial matters such as budgeting and obtaining the latest information about financial products.

Britain has been hit by misselling of financial products, ranging from personal pensions to insurance on consumer goods.

Last week the government said it will propose legislation to set up a new national money guidance service to help consumers, funded by a levy on the industry.

The FSA has proposed banning investment firms from paying commission to consultants who sell their products so that consumers can get unbiased financial advice.

(Reporting by Huw Jones, editing by Elaine Hardcastle)