Geithner defends plan to increase financial oversight, bolster powers of the Fed

Geithner defends plan to step up oversight

WASHINGTON — Treasury Secretary Timothy Geithner says it is clear that the government could have done more to prevent the economic downfall.

In prepared testimony, Geithner says that gaps and weaknesses in the regulatory framework governing banks and other financial institutions “presented challenges” to the government’s ability to monitor and address risky market bets.

One problem, he says, is that no single regulator saw its job as protecting the economy and financial system as a whole.

The administration’s plan, which Geithner will outline Thursday before the Senate Banking Committee, calls for the Federal Reserve to do that job supported by a new council of regulators.