LONDON, March 29 (Reuters) - The head of the UK parliament'sTreasury Committee on Saturday described as an "extraordinaryblunder" the leak of a planned review by the financial serviceswatchdog into the life insurance industry, which sent shares ininsurers tumbling.
The Financial Conduct Authority (FCA) was due to announcethe investigation in its annual business plan on Monday. But asenior FCA supervisor outlined the review in a press interviewon Friday.
"On the face of it, this is an extraordinary blunder,"Andrew Tyrie, the Treasury Committee head, said in a statement.
"It is crucial that we have a full and transparentexplanation about how such an apparently serious mistake came tobe made by our financial services watchdog - the body appointedby parliament to enforce high standards of conduct."
Insurance stocks fell sharply on speculation the reviewcould lead to changes that affect the profitability of theirproucts.
The FCA later issued a statement saying its boardacknowledged market concerns regarding press coverage of theplanned investigation.
"The board will conduct an investigation into the FCA'shandling of the issue involving an external law firm and willshare the outcome of this work in due course," it said.
Tyrie said his committee would want to be satisfied theexternal oversight of that investigation would be independent ofthe FCA. He said one external person should be in overall chargeof the inquiry into the leak.
"The Treasury Committee will probably want to see theindependent reviewer before he or she commences work," he added.
The FCA industry review will look at whether people lockedinto some 30 million pension and other savings plans sold byinsurance firms in the 30 years after 1970 are treated fairlycompared with new clients. (Reporting by Stephen Addison; Editing by Sophie Hares)