Ken Davy, chairman of the SimplyBiz Group, also claimed the current model for FSCS funding is a “grotesque injustice” and called for reform.

Following the FCA launching a new Mission statement, Mr Davy said these matters needed to be central in the regulator’s refined strategy.

Mr Davy said: “Protecting clients from poor outcomes from unregulated investments is vital so a great deal more has to be done to ensure that consumers understand when a product is unregulated.

“Frankly, the lack of clarity in respect of the promotion of such investments is a disgrace. Whilst some of these products may be legitimately suitable for some clients in some circumstances, far too many are not in fact investments at all. If the FCA's mission statement addresses this properly it will be good for consumers and financial advisers alike.”

Mr Davy was encouraged that the FCA Mission Statement included a pledge to clarify its stance on unregulated products.

In a white paper, Mr Davy outlined why he believes the current FSCS funding model is unfair, saying FOS statistics showed advisers have relatively few complaints indiviudally.

He said: “In a 30 year plus career an adviser is unlikely to have more than one complaint upheld against them, which we suggest is a record most professionals would envy. It is also unlikely in the extreme, that the cost of settling an upheld complaint will exceed £5,000.

“Against this reality even quite small advisory firms are being charged thousands of pounds per year to fund the FSCS caused by firms whose advice has been careless, reckless or dishonest and who have subsequently gone out of business.”

Many of the liabilities fallen on the FSCS have been a result of product failures and/or corporate fraud, rather than bad advice, he said.

He said that the current method, “where the costs fall entirely on the advisory sector, is so unfair as to be a grotesque injustice”.

FCA chief executive Andrew Bailey has announced that a new product levy is to be considered as part of the review of the FSCS.

Mr Bailey said the FCA was looking at “the possibility of risk-based levies related to the products or services a firm offers, its capital reserves or complaints reported”.

He said: “We are aware that some sectors of the industry are keen to fund the FSCS through a product levy, and we will be considering this proposal in our consultation.”

The FCA is looking at the relationship between FSCS funding and the professional indemnity insurance held by firms, in particular whether a separate review is required of the PII market.

Other potential moves include “smoothing firms' levy contribution by, for example, merging certain funding classes or through more extensive use of the FSCS credit facility”.

The FCA plans to publish a public consultation paper at the end of November outlining a range of proposals to “enhance the current funding model”.

Final rules should be in place by the summer of 2017, with the new arrangements taking effect from the 2018-19 levy year, Mr Bailey said.