The FSA was too focussed on its role as a consumer protector in the run up to the financial crisis and failed in its oversight of macro-prudential requirements, according to a House of Lords committee.
The Lords' Economic Affairs Committee says the tripartite regulatory regime, where the financial sector is overseen by the Bank of England, FSA and Treasury, has been a failure and rapid changes are needed. Regulators at the FSA failed to take sufficient steps to alleviate the risks to the financial system caused by an excessive build up of debt and the use of complex financial instruments. Instead, the FSA spent much of its time focussing on consumer protection and outcomes, and should be stripped of its responsibilities for financial stability. The Lords believes the Bank of England...
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