Isakson helps lead call for probe

Washington —- U.S. Sen. Johnny Isakson wants to launch a full-scale congressional investigation into the near-collapse of the banking system that has roiled financial markets worldwide.

Isakson (R-Ga.) and Kent Conrad (D-N.D.) introduced legislation Thursday that if approved would create a seven-member Financial Markets Commission to try and determine how U.S. banks have lost tens of trillions of dollars and put borrowers, taxpayers and the world economy at risk.

The commission is being modeled after the bipartisan 9/11 commission that investigated the Sept. 11, 2001, terrorist attacks.

It would have full subpoena powers, a $3 million budget and would refer any evidence of illegality to federal and state prosecutors and regulators.

“I can tell you … the gravity of this situation and the size of it happened because some things went on that should have not gone on,” said Isakson, a former real estate broker.

“It’s about time we found what went wrong, why it went wrong and correct it.”

Members of the commission would be appointed by President Barack Obama, House and Senate leaders and Federal Reserve Chairman Ben Bernanke.

The nation’s financial system, at the epicenter of the worst economic conditions since the Great Depression, appears ripe for investigation and primed for new regulation.

Separately on Thursday, the U.S. Government Accountability Office —- the oversight and investigative arm of Congress —- said the government’s financial regulatory system has “major weaknesses” and has failed to keep pace with market trends.

The GAO called for more oversight of federal bailout money that’s going to banks, insurance companies and other financial services firms, and a modernization of industry regulations.

The government has already agreed to a $700 billion bailout of the financial industry, and more assistance may be needed soon.

Atlanta-based SunTrust Banks Inc., for instance, has already received $4.9 billion in assistance from the government.