How much longer can the FSA survive?
Today, the Parliamentary ombudsman trashed the hapless regulator in a report on Equitable life. In the report, the Ombudsman made ten determinations of maladministration naming explicitly the FSA, the Department of Trade and Industry, and the Government Actuary's Department in relation to their regulation of Equitable up to December 2001.
The FSA was probably the worst idea that New Labour conjured up when it was first elected in 1997. Under its watch, UK banks financed an unsustainable housing bubble, which is now unwinding, and threatening to bring the financial system down. It passively watched while the UK suffered the first bank run in over one hundred years. Now, we learn that it is guilty of maladministration over the Equitable Life fiasco.
The FSA's regulatory functions should be returned to the Bank of England. It is failed institution that will keep on failing until someone has the good sense to abolish it.