The boss of the financial watchdog of the United Kingdom has said criticism from MPs that he failed to reform after years of scandal “is not fair”.

Nikhil Rathi, chief executive of the Financial Conduct Authority, said it was “tackling financial crime… on a scale never seen before in the UK”.

He was responding to a report from a cross-party group of MPs which said the FCA was “incompetent” and that their culture has become worse rather than better.

He also accused the FCA of failing to properly investigate the banks and other financial organizations it regulates, suggesting it may be too close to them.

The report published on Tuesday came as a result of a backlash against the FCAs handling of Neil Woodford’s investment scandal and other controversies such as his banking report.

He referenced years of similar criticism from other reports, including 2016 paper from the New City Agenda who said the FCA had a “deep-seated culture of box-ticking”.

The report also hit back at the suggestion that the FCA had changed.

“It is vital that the reader does not fall into the trap of thinking that the long list of problems has been solved by the FCA… already, the carefully collected evidence shows, as they have not,” the report said. .

However, in an interview with BBC Radio 4’s Money Box show, Mr Rathi defended the FCA against these claims and insisted that the regulator had improved.

“We will always focus on improving our operational performance, but I don’t think it would be fair to characterize the position as nothing has happened,” he said.

He added that the FCA is carrying out “a record number of financial crime prosecutions” and is “one of the most advanced consumer protection systems in the world”.

The report says the FCA may have been “captured”, meaning it is too aligned with banks and other financial organizations to act against them.

He argues that there are “unmanaged conflicts of interest” within the FCA due to its role in protecting consumers and promoting economic growth.

He suggested that the watchdog should be removed back to a regulator focused solely on the well-being of consumers – leaving the government to focus on economic growth.

He also suggested that the FCA’s leadership should be replaced “if necessary”, calling its current leaders “opaque and unaccountable”.

Mr Rathi said the issue of growth versus consumer protection needed “debate”, but Chancellor Rachel Reeves was pushing him to pursue growth.

He accepted that promoting growth could involve increased risks for consumers, pointing to changes he had made to allow more companies to list in the UK, such as on the London Stock Exchange.

“We’ve been very transparent all the way through that discussion over the last 18 months that this would introduce more risk into the system. [but] this was deemed necessary,” he said.

“That means some other things will go wrong over time, but the risk appetite in the economy needs to be adjusted to support the growth the economy needs.”

On the issue of accountability, Mr Rathi said the FCA appears before Parliament and select committees and publishes more data than “any other regulator in the world”.

A spokesperson from the Treasury told the BBC: “Many of the issues explored in the report have been comprehensively reviewed, and as a result the FCA has made a number of changes.”