The abject failure of the UK regulatory organizations to foresee and prevent the Northern Rock crisis has been explained. After an internal investigation, the Treasury has admitted that although it was clear that the FSA should be overseeing banking operations in this country, there was confusion within the City and Government about whether this was to be the Financial Services Authority or the Food Standards Agency.
"After all the incessant Government warnings about obesity and unhealthy lifestyles as well as attacks on city fat cats, we just assumed it was the Food Standards Agency we should be liaising with," the report quotes bank staff as saying.
Senior Executives at Northern Rock said that they were surprised when after explaining the intricate details of their re-financing of risky mortgages, they were told it was fine as long as they had five portions of fruit and veg and took daily moderate exercise. However, as it made a whole lot more sense than the guff they'd had out of the Financial Services Authority over the years, they had got on with it.
The Treasury concludes that although the mistake brought a major bank to its knees, causing the biggest economic crisis this century, at least Northern Rock's employees had reduced their chances of cancer and heart disease.
