Is George Osborne making a mistake with UK financial regulation?
As many had feared, George Osborne has confirmed that the Bank of England will become the central and the focal point of the UK financial regulatory structure in the future. The FSA will become a subsidiary of the Bank of England, will be disbanded completely or replaced by other new authorities. Either way, there is growing concern that George Osborne could be about to set the UK financial regulatory framework back by many years.
While there's no doubt that the current structure is not perfect, the very fact that the FSA has been more successful than ever before with convictions and issued more fines than ever before are factors which should not be discounted. There's great disappointment within the FSA at the apparent decision to transfer control to the Bank of England and many former supporters of George Osborne believe he could well be making a major mistake.
Historically, the more parties involved in the UK regulatory system the more potential for friction between these parties and the more problems with communication and the transfer of data and information. If information and data is required from numerous parties then this will inevitably slow down the regulatory process and could indeed cause major problems.
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