THE Chancellor is considering changing a law which the Financial Services Authority (FSA) has blamed for preventing it from publishing the findings of its investigation into Royal Bank of Scotland (RBS) and its former chief executive Sir Fred Goodwin.
George Osborne could announce an investigation into the Financial Services and Markets Act (FSMA) as early as this week after the FSA said the law prevented it from publishing the details of its joint investigation with PricewaterhouseCoopers (PwC) into the actions of RBS in the lead up to the financial crisis two years ago.
Osborne is believed to be keen to act before the FSA completes it investigations into toxic loans at HBOS and the collapse of Bradford & Bingley for fear they may be subject to the same restrictions.
The regulator says the FSMA allows it to only publish details of investigations which result in it taking enforcement action against an individual or company.
In the case of RBS the regulator found both the bank and Sir Fred innocent of any specific wrongdoing. As a result, the FSA says, it must seek the permission of those who were the subject of its investigations before it can go ahead and publish the report.
But this weekend Goodwin’s friends suggested he would have no objection to publication of the FSA findings. Goodwin himself has refused to comment on the issue.
The Treasury meanwhile issued a simple statement claiming that whether to publish the report or not was a “regulatory matter.”
Since the findings were announced last week the FSA has come under pressure to publish, as have Osborne and Business Secretary Vince Cable.