Martin Wheatley said it is inevitable that some savers will run down their retirement income in days, not years, buying flashy cars, going on cruises or heading abroad.
He suggested that ultimately anyone who does so and regrets it would only have themselves to blame.
He said the country is entering "unchartered territory" in April when the new pension rules take effect.

{desktop}{/desktop}{mobile}{/mobile}

He told the NAPF Investment Conference, Edinburgh: "Certainly, under the system as it will be, there will be no ability to prevent all of the people, all of the time from making 'sub-optimal' decisions.
"Some savers, come 55, will invariably head to Las Vegas, buy fast cars or otherwise calculate how to run down their pension pots in days and months, rather than years.
"Some responsibility, by definition, has to bump across from industry to customers. Otherwise you simply return to difficult conversations around why policy makers should, in effect, decide how savers draw their money.
"Optimists will be inclined to believe that these numbers will be fractional. Pessimists that they may be more significant. Indeed Saga seems to have suggested that cruise bookings have already risen by some eight per cent ahead of April.
"But the reality is that this is all simply part of the process that flows from the benefit of freedom. Some responsibility, by definition, has to bump across from industry to customers. Otherwise you simply return to difficult conversations around why policy makers should, in effect, decide how savers draw their money."
The question he posed to delegates was who, ultimately, will be to blame if – ten to 15 years on from now - people regret choices they've made, or complain they weren't properly guided?
He said: "Actually at that point, it becomes difficult to sensibly argue that individual consumers shouldn't accept responsibility. Nor, I think, would wider society expect otherwise."
He said April brings a "great unknown" for everyone involved in pensions, be it providers, advisers or savers.
He acknowledged the uncertainty and unpredictability that the situation is bringing but stressed that implementation was all the FCA was focusing on.
He said: "What matters now is simply: delivery, delivery, delivery. How effectively are political principles applied in practice? How well are consumers supported under the new regime as we move things forward?"