The Financial Services Authority (FSA) has published the business plan and risk outlook for the Financial Conduct Authority (FCA), one of the two new successor bodies set to take over the regulator's work in April next year.

The FCA's focus for work in its first year will include areas where the FSA has traditionally been active, such as consumer protection, tackling market abuse, and addressing identified examples of misconduct, such as LIBOR, Payment Protection Insurance and interest rate swaps. The new authority will also carry forward existing policy initiatives such as the Mortgage Market Review, the changes to retail investment advice and work on EU directives.

In addition, the FCA will develop a new Competition Department designed to embed competition analysis across the organisation, which will take action as appropriate.

The FCA identifies a number of risks for the year, including firms failing to design products and services that respond to real consumer needs; lack of transparency on financial products and services; over-reliance on payment and product technologies; a shift to riskier funding strategies; and consumers' lack of understanding of risk and return.

In another departure from current FSA practice, the FCA's approach to risk will also include a focus on longer term risks, such as firms not investing in innovative new products to meet the changing needs of society; withdrawal of sales forces; and too few new entrants in to the industry to allow competition to flourish.

Martin Wheatley, CEO designate of the FCA, said: 'We are introducing new approaches to the way we do much of our work, becoming much more proactive and consumer focussed. A risk for all regulators is becoming bound to conventional thinking. That is why the new regulator will be much more transparent, so we can learn from our mistakes. There is no room for the poor behaviour of the past. We will take action early and decisively when we see evidence of poor practices.'