FSA CLAIMS IT DIDN’T KNOW. THIS IS INTERESTING.
Lord Adair Turner has today been quoted by a few newspapers that the FSA didn’t know the scale of the mess the banks got us into. He said the FSA was ineffective and it would now regulate the City of London more firmly and effectively by increasing salaries to attract brighter individuals.
He should not have to do this. The financial services industry should not be hiding their activities from the regulator. It should not be the case that the regulator has to find out what the City is doing. The City should tell the regulator. However, for whatever reason, the City did not do this.
The FSA website states that the financial services industry finances the FSA, i.e. the firms it regulates. Therefore the lack of finance from the financial services industry contributed to the mess because if the financial services industry had financed the FSA more then the FSA could have offered larger salaries to attract brighter individuals to regulate the City. However, for whatever reason, the financial services industry did not do this either.
Whether the FSA complained to the financial services industry about this before I don’t know, and is perhaps the subject of a FOI request.
The FSA website also states that, although the financial services industry finances the FSA, the board of the FSA is appointed by the Treasury.
Therefore the Treasury bears some responsibility in appointing ineffective board members.
The current board members include;
Chairman of the FSA, Lord Adair Turner – long time member of the board of Standard Chartered, and from 2000 to 2006 he was Vice-Chairman of Merrill Lynch Europe.
Deputy Chairman of the FSA, Sir James Crosby – former Rothschild senior employee, and later Chief Executive of HBOS.
Chief Executive Officer of the FSA, Hector Sants – former CEO of Credit Suisse first Boston, who advised on the bailout plan and who are accused of creating the Mortgage Backed Security that financed the derivatives that got us into this mess.
These kind of people do not inspire me with confidence. In fact the words “fox” and “chicken” come to mind.
These people, coming from so high up in the financial world must know the money creation scam, and yet fail to tell you on the FSA website.
I remind you again, the FSA by law should educate you on the financial system and also protect you.
It has done neither.
So despite Adair's claim of FSA ignorance, the FSA, the Treasury and arguably even more so the banks, still stand accused of conspiring to screw you for every penny the banks can get, keeping you in ignorance of the mechanics of the financial system and not protecting you from the