The internal audit review into the FSA’s role in the crisis published today said that even if supervision had been carried out at an acceptabe level, it did not mean the outcome would have changed.
Shadow Chancellor Vince Cable says: “It is welcome that the FSA has had the courage to admit that it failed to adequately regulate the actions of Northern Rock, though the reality is that it had little choice.
“However, trying to claim that the crisis may have arisen anyway, even if it had dealt with the problem properly, is a total cop out.
“It is critical that the FSA sets itself higher standards in the future. Not only should it be alert to known dangers, but it should also investigate the impact and risk of new business practices.
“Simply asking for more staff is not the answer, we need intelligent regulators not legions of box tickers – quality not quantity.”