Bernanke advocates for regulatory council

WASHINGTON, Oct. 1 (UPI) -- U.S. Federal Reserve Chairman Ben Bernanke told members of a House panel a council of regulators would best protect the financial system from overall failure.

As lawmakers hone arguments for regulatory reform, seeking a strategy to protect the financial system from systemic risk, Bernanke told them that "for purposes of both effectiveness and accountability, the consolidated supervision of an individual firm, whether or not it is systemically important, is best vested with a single agency."

"However, the broader task of monitoring and addressing systemic risks … may exceed the capacity of any individual supervisor," he said Thursday in remarks prepared for delivery to the House Committee on Financial Services.

The Fed is in a precarious position, advocating for its own turf in the midst of a financial crisis many say the Fed failed to confront in its earlier stages.

Bernanke touched briefly on a second potential front of an agency-to-agency turf war: Consumer protection.

The Obama administration has proposed creating a stand-alone financial consumer protection agency.

"The playing field is uneven regarding examination and enforcement of consumer protection laws," Bernanke said.

"Addressing this discrepancy is critical both for protecting consumers and for ensuring fair competition in the market for consumer financial products."