Study On Financial Consumer Rights Protection

Issues regarding the consumers in the field of financial sector have long been in existence, and become prominent after the subprime crisis, which make financial consumer protection one of the hot issues in the current international finance sector. Studies made by many countries and international organizations show that if we focus only on the protection of the interests of financial institutions while ignoring consumer rights protection, the foundation of the finance industry will be seriously damaged.The purpose of this article is to study the protection of financial consumer rights, which as follows:Introduction: Introducing the significance of the study on financial consumer protection, current status of the research, ideas and methods of the research, difficulties and innovations in the research.ChapterⅠ: Analysis of the concept of the financial consumers and their rights. With the development and prosperity of social services, financial consumer is increasingly becoming an essential element of personal and household consumption. Also, due to asymmetric information, conflict of interests, consumer issues resulting from the weak position of consumers are also raised in the field of financial consumption, and consumer protection movement has gradually spread to the field of financial consumption. About the connotation and denotation of financial consumer, on the standard regarding the subject, consumer should be individual, which has no objection, but entity should not be ruled out in financial consumer because of its characteristics. On the standard regarding the purpose, due to the reason that the purpose of living consumption is not a clear concept, it is not suitable to be used for explaining the purpose of consumption. As to the financial consumption, its purpose is diverse. This article argues that the weak position of financial consumer should be more concerned. On the standard regarding the amount, this article considers that it is particularly significant for defining the financial consumer. This article defines the financial consumer as: the financial consumer is the natural person, legal person and other organization that accepts the financial products and services provided by financial institutions, excluding the professional investor whose investment exceeds the limits set by law. There are some common points and differences between the financial consumer and the ordinary consumer. Moreover, in some cases, it is difficult to distinguishing them between each other. Research on the nature of rights there are several theories, no matter the nature of the right which is a combination of one or several, financial consumer rights can be summarized as financial consumers to purchase financial products or services to be enjoyed, reflected on the tilt protect to financial consumers. Property rights of financial consumers, there are arguments of “special theory of civil rights” and “economic law rights theory”.Chapter Ⅱ: International practices of financial consumer rights protection. After the subprime crisis, developed financial market countries or regions have begun a wide range of consumer protection legislation and financial regulatory reform. This article describes the relevant reform the United States, Britain, the European Union, Japan, Canada, Australia, China’s Hong Kong, and introduces the financial consumer protection model rules drawn by OECD, world Bank, IOCU. These reforms or the model rules extend the extension of the concept of consumer to financial sector. This article summarizes the main principles involved in these international practices, system or mechanism.Chapter III: Hot areas in the fields of financial consumer rights protection. According to the traditional division, fields of financial consumer rights are divided into the banking sector, securities sector and insurance fields. In recent years, banking intermediary business charge, banking card, financial products, credit information have become a hot area in the field of banking. From the point of view of market behavior, insider trading, market manipulation, misrepresentation, chooses to disclose, transfer of benefits, fraudulent transactions, etc, are malignant tumor to long-term damage the financial interests of consumers in the capital market. From the point of view of the subject, the largest shareholder control, internal control, illegal operation by securities intermediaries are the main financial harm to the interests of consumer, and improving the protection mechanisms for consumer rights in financial capital markets are effective way to protect the interests of financial consumer. Financial consumer issues in the field of insurance sector focused on misleading sales, claiming difficulties and over-complex contracts with fraud terms concealed. But today, the international community has seen many changes in favor of insurance consumers, such as the obligation to inform the consumer of insurance mitigation, insurance people first contractual obligations, insurance payment “principle of proportionality”, popularized terms of the insurance contract, the insurance contract interpretation “reasonable expectation principle” and so on. In the current world, financial mixed development has become a global trend, with echoes that consumer rights protection tends to the full protection of the financial consumer. China’s financial sector and industry division also tend to become the comprehensive and mixed operation.Chapter Ⅳ : Civil law protection of financial consumer rights: identity return. Asymmetric information is the symmetry root cause of the malfunction of the assumption of the “economic man” or the “rational man” in economy and civil law. Accordingly, “bounded rationality” replaces the concept of the rationally and strong intelligent man abstracted in civil law. In the financial market, due to the intangible nature of the financial products and the social division, asymmetric information is very significant. Asymmetric information will lead to the moral hazard, the adverse selection, the herd effect and other problems, the vulnerable status of financial consumers is exacerbated. The movement of social standard in modern civil law emphasis the correction of the formal justice and the returning from status to contract and the justice of contract, which promotes the financial democracy and the sovereignty of the financial consumer and the development of the fiduciary duty of the financial institution. The value of financial law should more emphasize on the equality than purely on the classical contract theory. This change is sufficiently proved by “three-legged theorem” theory and “bimodal theory” in financial law.Chapter Ⅴ: Contract rights protection of the financial consumers. The first relationship is contractual between the financial consumers and the financial institutions, etc. According to the contract theory of justice, the weak position of financial consumers is attented, which raises the fair trading right, right to choose, the right to information, right to go back, etc. Corresponding, the principle to pay attention of selling needs to be stressed, therefore financial institutions have the the obligation of appropriate obligations, obligation of information disclosure and instructions. And if financial institutions have the existence of fraud in contract behavior, punitive damages responsibility should be burdened.Chapter VI: Tort law protection of financial consumer rights. If the financial consumer rights are torted in consumption process, the rights can be protected and remedied by contract law, in addition, tort law may also be applied. Tort law generally protects absolute rights. financial consumer’s absolute rights which can be protected with tort law include privacy right, credit right, and security right. Elements of of financial consumer infringement should be similar to the general theory of tort elements in theory. This article focuses on the identification of damage, the contents of the principle of imputation, competing responsibilities and other aspects of the deal.Chapter VII: Realisation of financial consumer rights. Rights are that can be realized. From the oughting rights to the legal rights then to the real natural rights, it needs human’s advocating exercise, fulfill obligation by the obligation, as well as the recognized state power to protect and provide relief channels. Right itself contains limits. The exercise of the rights of financial consumer, first need to resolve the conflict and to clarify the boundaries of the right issue, which requires legislation and case specific basis in the law enforcement and judicial legitimacy, not derogatory, the principle of minimum value judgments and measure. Perfect legislation is a necessary condition to strengthen financial consumer protection. Our country needs to learn from international experience and adopt the integration mode on the basis of the revised “Consumer Protection Law”. No relief no rights, hence to achieve financial consumer right must also be reflected in relief. This article advocates improving the role of the private rights of relief at first. In addition to emphasis on judicial remedies, non-litigation relief channel should also be focused on. This article is devoted to borrowing and building financial consumer non-litigious dispute resolution mechanisms.