Financial crisis was caused by corporate mismanagement, says US government
2008 crash was avoidable and largely caused by unnecessary risk-taking, says financial crisis inquiry commission report
By Dominic Rushe
Wednesday 26 January 2011
The 2008 financial meltdown was avoidable and largely caused by unnecessary risk-taking, corporate mismanagement and inept regulation, according to the US government’s official report.
The financial crisis inquiry commission’s official report is due tomorrow but according to leaks in the New York Times it will conclude: “The greatest tragedy would be to accept the refrain that no one could have seen this coming and thus nothing could have been done. If we accept this notion, it will happen again.”
Regulators “lacked the political will” to oversee and hold accountable the institutions they were supposed to oversee, the report says. Politicians let the regulations slide. Finance chiefs were guilty of questionable practices and incompetence.
The panel has reportedly concluded that several financial industry figures may have broken the law in the run-up to the crisis. Several potential legal cases may now be passed to state or federal authorities for further investigation and potential prosecution.
In the three years since the meltdown there have been few prosecutions.