The FSA has so far filled 13 out of 17 directors' posts with exactly the same people who used to run the nine old regulators which it is replacing. Last year, firms said they feared the new regulator would be out of touch with commercial realities.
Howard Davies, the chairman of the FSA, has now contacted dozens of leading figures in financial services in an attempt to persuade them to fill "important gaps in crucial posts, which we are now looking outside to fill." These include a director of investment business, a director of finance and business planning, a director of consumer relations and a director of market exchanges.
But there is concern the regulator will have difficulty filling the posts with well-qualified people unless it can offer salaries approaching the generous rewards of the City. The FSA is still looking for candidates, despite appointing recruitment consultant Saxton Bampfylde and advertising in the press.
In a letter to potential applicants, Mr Davies wrote: "Needless to say, the packages we can offer are derisory by market standards, but the interest quotient of the jobs is very high!"
Until now, regulators have been paid comfortable six-figure salaries.