There is an excellent film called A Few Good Men with Jack Nicholson playing the part of Colonel Jessep, a bullet-spitting US Marine, and Tom Cruise playing the part of Lieutenant Kaffee a junior defence attorney in the Navy.
The film revolves around a “code red”, an illegal form of internal discipline that resulted in the death of a US Marine, which had been sanctioned and then covered up by Jessep. With the evidence destroyed, tracks covered and a dubious code of honour, it looked as though Kaffee was going to lose the case with the result the two Marines that carried out the fatal punishment would go to prison while Jessep remained free.
In a wonderful piece of courtroom drama, we see Lt Kaffee finally corner his man and Jessep admit it was he who ordered the code red and is thus brought to justice.
I was reminded of the film following an exchange I witnessed at a lunch last November. Sally Dewar, managing director of the risk business unit of the FSA, gave a speech and talked about several things, including how the FSA were working better with the advisory sector. It was a professional though predictable presentation that was not going to set the world alight. But the insights came during the questions she took from the audience.
When asked whether the FSA had dropped the ball with regard to regulating the banks in light of the credit crunch and economic meltdown,
she replied that the situation had been a learning experience.
A learning experience! What is that supposed to mean? Is it political speak meaning “we are really and truly sorry, we didn’t know what we were doing but we cannot really admit it” or was this their Colonel Jessep moment – except they do not get brought to justice.
To describe it as a learning experience is insulting to all who have seen their incomes fall, their businesses and clients’ portfolios suffer, colleagues losing jobs, the lack of bonuses and the list goes on. It is beyond arrogance that the scope of their failure can be reduced to
something as trite as a learning experience. That is one hell of an education bill.
The Government has already spent £117bn propping up financial institutions. Yet even this is dwarfed by the estimated £850bn that the taxpayer is on the hook for.
I do not agree with Chris Cummings when he says the FSA have changed their attitude, this slip of the tongue convinced me otherwise. There needs to be a regime change but the present Government does not have the stomach for it.
Dennis Hall is managing director of Yellowtail Financial Planning