Banks in the US should have to abide by stricter rules than those laid down in the Basel III regulations, the Systemic Risk Council (SRC) has stated.
In a letter sent to current leading regulators, the group of former officials - which is led by ex-Federal Deposit Insurance Corporation chair Sheila Bair - have urged their successors to take no risks in terms of stabilizing the American banking system, Reuters reports.
For instance, the SRC has recommended that the Basel III rulings should be implemented as soon as possible, with additions to the regulations such as a stricter limit on leverage in large organizations and the reduction of banks' exposure to each other.
"These are good minimum standards that can and should be exceeded," the document added.
In reference to the recent trading scandal at JPMorgan Chase, the SRC noted this offered proof that "complex models are prone to failure".
By Gary Cooper