The Government has rejected calls to impose a duty on UK regulators to consult on European and international regulations.
Speaking in the House of Lords on the Financial Services bill, Howard Flight argued for an amendment to the bill to force UK authorities to consult with the industry and consumers.
He said there is very little accountability for international regulators such as the European Securities and Markets Authority, the European Banking Authority and Financial Stability Board.
Flight said: “To avoid mistakes it is important for the UK entities to have consulted fully with the financial services industry.
“In general the UK representatives in Brussels have done a good job of looking after UK interests but as prescriptive legislation is the measure of the day we should prescribe for such a consultation.”
Flight said the FSA had not consulted properly over Mifid II.
Representing Labour, Lord Bryan Davies also backed the amendment but it was rejected by the Government.
Deputy chief whip Lord Dick Newby said: “It is not necessary to have an explicit provision on the face of the bill to make sure it works well in the future.
“At an international level there is growing recognition that they should consult and in many ways that is going to be the most effective way at consultation.
“The UK practice has been a mixture of formal and informal consultation. It has meant the FSA and Treasury have gone into negotiations in Basel and EU having gauged the views of the UK financial services sector and sought to reflect them effectively. I think the sector feels that is the case.”