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Monday, March 10, 2008

The Sleepy Old Watchdog

In the most telling outcome of the Northern Wreck fiasco of last year, a Freedom of Information request has revealed that most of the officials at the Financial Services Authority (FSA), who fell asleep at the wheel whilst "supervising" Northern Rock have quit.

The Times reports that five of the seven FSA supervisors working closely on Northern Rock have left.

The fact that this information had to be extracted by use of a Freedom of Information Act request speaks volumes about the FSA and their concept of "transparency".

The fact that five officials have left speaks volumes about the quality of the supervision by the FSA.

A report by Rosemary Hilary, the FSA's internal auditor, about the FSA's supervision of Northern Rock will be released later this month. Hector Sants, CEO of the FSA, is already denying speculation that the report will be a whitewash.

However, despite his claims, Sants also slips in the fact that some details will be held back to protect the legal rights of employees and to respect the confidentiality of competitor banks examined for purposes of comparison.

The FSA doesn't seem to to like the idea of public accountability.

I find this to be somewhat ironic, given that the FSA is meant to supervise and hold accountable organisations that operate within the financial services industry.

The FSA doesn't seem to "get" that the concepts of transparency and accountability also should apply to itself.

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