Lord Turner points the finger of blame at light touch regulation
The chairman of the Financial Services Authority (FSA), Lord Turner, has today suggested that the finger of blame should be pointed at various governments in the past who took on a light touch regulation system. In effect, as we have mentioned in the past, this was effectively a form of self-regulation whereby financial companies throughout the UK will very proactive in defining and shaping the regulatory framework and environment for the financial industry. This would appear to have left too much scope for risk-taking which has seriously backfired over the last few months.
Lord Turner has also gone as far as to suggest that a "revolution" is needed in the world of UK financial regulation such is the weakness of the current system. However, Treasury committee members have also questioned the role of the FSA in the UK regulatory system and the apparent inability to spot what have been substantial changes to risk profiles over the years. The FSA must carry a vast majority of the blame for the ongoing economic crisis as the authority has taken hundreds of millions of pounds of taxpayer's money over the years to protect consumers.
It appears inevitable we will see serious changes in the regulatory framework of the UK in the short to medium term.
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