Financial Services Regulation Under the Financial Services Authority: a Reassertion of the Market Failure Thesis?

Despite the fact that the "nature, role and form" of financial market regulation has varied - sometimes significantly - from jurisdiction to jurisdiction, traditionally there has been a remarkable degree of unanimity about the need for comprehensive regulatory controls governing the operations of financial institutions and the financial markets more generally. In essence, this consensus derives from a conception of financial markets as being sufficiently distinct from other kinds of economic activity, such as manufacturing electrical goods, or the marketing of adventure holidays, to require extensive regulation and oversight. From a descriptive point of view, the inspiration for much of this regulation - at least in its statutory form - can very often be traced to various reactions to financial crises. In the US, for example, extensive Federal Securities legislation, which has been in place since the 1930s, was Congress's response to bank runs and alleged financial abuses in the depression era.