James Moore: Here we go again... mea culpa will be part tragedy, part farce

It's like handing over the World Cup final to the bloke who referees pub football

The Financial Services Authority is starting this decade in a similar manner to which it started the last one: with an embarrassing mea culpa. Just as with the life insurer Equitable Life, the FSA will, in today's report into the failure of Royal Bank of Scotland, admit to a series of errors.

Just as with Equitable (Northern Rock too), it will be part tragedy, part farce. With the former it emerged that staff supervising prudential financial health sat next to those who policed sales. They never talked.

Northern Rock was not deemed important so it was left to a team whose expertise lay in regulating insurance companies. They hardly noticed it. There'll be a doozy or two like that today.

Amazingly, Britain still possesses a world-class financial centre. It's just overseen by a second-class watchdog. It is like handing the World Cup final over to the bloke who referees pub football at the recreation ground.

The real responsibility for RBS's woes lies with its executives (especially its CEO). Let's not forget the non-executive directors who seemed to feel it was okay to pick up six-figure fees for wielding a rubber stamp.

RBS, Equitable, Northern Rock and, for that matter, Independent Insurance and HBOS (although we didn't get reports on those two): two insurers, three banks, one story. Their boards were to blame but in each case the FSA failed to raise a red flag. In each case the result might not have been as bad had it done so. What is really worrying is how little seems to be learned.

We can only hope the FSA's successors, the Consumer Protection & Markets Authority and the Bank of England, do better. But given that the latter knows a thing or two about hubris and foul-ups (remember BCCI) it's very hard to be optimistic.