A panel that is burdened with the responsibility to carry out inquiry into financial crisis, on Thursday, was informed by Ben S. Bernanke, who is the Federal Reserve Chairperson that watchdogs failed to use their powers and authorities in the right way, which they should have used, so as to stop risky practices by banks.
Also, he said that the regulators did not recognize and tackle the abuses that had taken place in the financial system of the United States of America, which gave a byproduct in the form of global economic slump.
While speaking on the occasion and offering a lengthy analysis, Bernanke said that regulator group appointed by the Government did not put in sufficient efforts to offer protection to consumers in the market and also did not make it necessary for big financial houses to lessen carrying out risky practices.
He said that watchdogs had identified the troubles only in a few cases, however, did not take any proper action to fix them there and then.
Mr. Bernanke said that the most important lesson that has been learnt from the most recent disaster is the troubles relating financial institutions, that were really extensive, and something must be done at the earliest.