In a speech in London yesterday, Wheatley criticised the FSA for pushing a “box ticking” culture in financial services which was “too captured by the interests of firms” and which did not always result in the best outcome for consumers.

“Too often our response was overly reliant on regulation by rote. We built ever more rules and guidance about how to build a compliant process. It was robotic. Too captured by the interests of firms.

“What we did too little was look at outcomes, so not ask ‘was the sale compliant?’, but ‘did it achieve a good outcome?'”

Wheatley said “mechanistic processes and procedures” – like more and more disclosure – fitted the needs of the huge compliance industry “like a glove”, but were an uncomfortable fit for the needs of consumers.

He said subsequent work by the regulator has revealed that disclosure and box ticking are “not the firm-friendly panacea once imagined”.

“In actual fact, in many cases – like [payment protection insurance] PPI – tick-box regulation simply encouraged a tick-box service. Leaving firms with often huge clean-up bills and badly damaged brands,” he said.

What UK financial services needs, Wheatley said, is a new model that is less narrowly focused on whether a process is compliant with a set of rules and more focused on whether it achieved an appropriate outcome.