I am a whistleblower, on lousy bank regulators, and FT, not withstanding its “Without fear and without favours”, also ignores me.

Sir, William D Cohan writes about the travails of “Wall Street whistleblowers”, May 31. In it he writes about “how little the regulators charged with keeping watch over the Wall Street banks seem to care about holding them in any way accountable”. The same can be said about how little those in charge with keeping watch over the regulators, like the Financial Times, seem to care little about holding them in any way accountable.

Since years back I am a whistleblower, on the Basel Committee for Banking Supervision, accusing it for having designed absolutely useless and even dangerous bank regulations. And though very few can demonstratively prove to have alerted from a reasonably high position bureaucratic post about what was wrong, the silence with which FT has met all my comments, has been deafening.

Just as an example, in a written formal statement at the World Bank, as an Executive Director I warned “

We believe that much of the world’s financial markets are currently being dangerously overstretched through an exaggerated reliance on intrinsically weak financial models that are based on very short series of statistical evidence and very doubtful volatility assumptions.”

And FT itself published one letter, in January 2003, in which wrote: “Everyone knows that, sooner or later, the ratings issued by the credit agencies are just a new breed of systemic error to be propagated at modern speeds. Friend, please consider that the world is tough enough as it is”; and another letter, in October 2004, in which I asked “How many Basel propositions it will take before they start realizing the damage they are doing by favoring so much bank lending to the public sector (sovereigns)?” 

But, just in case, am I arguing that anyone of the regulators has committed and illegal act for which they should be jailed? Of course not! Only that they have been so dumb that we need to parade them all down Wall Street, wearing dunce caps – or cones of shame… in order to increase our chances that the regulators think twice next time they feel as Masters of the Universe… and perhaps they should be joined in the parade by the editor of FT.

PS. Here is the link to my over 1.300 letters to FT on the subject.

PS. One day perhaps there will be a whistleblower within FT willing to explain it all :-)