Leading world economies should establish a “financial Interpol” to conduct investigations into market abuse and fraud in response to global financial turmoil, reports London’s The Financial Times, citing a conclusion from a French government report.
Proposals for the establishment of a separate global body to coordinate investigations into financial crime are just one of a series of recommendations aimed at accelerating the European Union’s response to the turmoil caused by the U.S. mortgage market crisis before it spreads to the entire financial system. French President Nicolas Sarkozy welcomed the report, asserting that he agrees with the government on the diagnosis of the causes of the current crisis, particularly regarding the loss of ethics and risk awareness at the very heart of the financial community, as well as the significant failure of rating agencies. He announced that France would present these findings at the EU finance ministers’ meeting in Nice next week.
The French president has repeatedly called for action to rein in financial markets, but the EU and national and international bodies are too slow in making concrete decisions. The report outlines 30 recommendations for tightening regulation and oversight of financial markets, which would focus more on methods for quicker decision-making by EU governments and international bodies. Rene Ricol, the accounting expert who prepared the report, stated that the priority must be to make quick decisions on a range of proposals where there is already consensus, in order to help restore confidence in the markets. The main proposal of this report is to establish a series of international conferences where regulators and other international supervisory bodies will meet and decide on amendments to their respective regulations. (H)
