An FSA investigation into the problems at Britain's failed banks has revealed a litany of internal breakdowns and flawed controls that masked the full extent of their failings, according to The Sunday Times.
The regulator has been conducting a full-scale supervisory review of Royal Bank of Scotland (RBS), HBOS and Bradford & Bingley (B&B) since last April.
A report on the findings is expected to be published within weeks and is set to reveal a catalogue of errors that allowed risks to go unchecked, according to the paper.
These include a breakdown in communication at all three institutions which kept board directors in the dark on the risks being run by company executives, according to sources close to the inquiry.
The regulator's report will also raise questions about public statements made by each bank in the weeks before the government’s series of bailouts.
Its investigation has not uncovered any illegal activity but it has raised a number of issues about corporate governance and risk management.
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