That’s why I baulked when I recently heard the chairman of the Financial Services Authority blaming political factors for the FSA’s failure to regulate.
The consequences of this failure include the collapse of Northern Rock, the ambiguous status of Bradford & Bingley and the virtual nationalisations of the Royal Bank of Scotland and Lloyds Banking Group.
As failures go, the FSA’s record is second to none – apart from that of the Prime Minister who was the architect of the regulatory system.
But even so, was Lord Turner of Eccinswell justified in telling the Treasury Select Committee that the FSA’s scrutiny of these financial institutions was affected by a political philosophy that it should not be heavy or intrusive?
He declared that the FSA was “supervising firms like HBOS within a particular philosophy of the way you do regulation which I think in retrospect was wrong”.
That falls just short of the Nuremberg defence – that his predecessor John Tiner and crew were only obeying orders.
Lord Turner and his political masters have overlooked the fact that not all banks failed to make the grade and that the flops were not brought down by defaulting borrowers but by errors of judgement at board level and in the regulatory system.
Sadly, the FSA still seems to be part of the problem rather than the solution.