Federal Reserve Board Governor Daniel Tarullo argued Friday that financial-firm compliance enforcement hasn't been stiff enough and that tougher action on the part of the Fed and other regulators was likely needed.
"The accumulation of violations, investigations, and in many cases, I think, acknowledgement of violations" in a variety of areas, Tarullo said during the second day of a tense two-day hearing on U.S. bank commodity activities.
The recent trouble in markets for interest rates, currencies, mortgages, and commodities, "suggests that in general, the compliance, procedures, mechanisms, expectations, within firms for abiding by laws ... are not adequate in many cases," he said. The Fed, Tarullo added, is focused on "how to assure" that robust enough monitoring is in place.