When regulators go for each other's throats

In a spectacle worthy of the Conservative Party, City regulators, that normally staid and home-loving bunch, are tearing each other apart at the throats. In-fighting, threats of dismissal, attempts to gag criticism - pretty unprecedented stuff for a group that prides itself on calm, discretion and discipline in the ranks. What's going on? Partly it seems to be a power struggle between the regulatory overseer, the Securities and Investments Board, and those bodies charged with the coal-face regulation of specific financial sectors, such as the Securities and Futures Authority and Imro.

Phillip Thorpe, chief executive of Imro, and Christopher Sharples, the chairman of the SFA, are becoming increasingly bold in the way they vent their frustration. They want a freer hand to get on with the job. They also criticise the SIB for being overbearing and getting in the way. Andrew Large, chairman of the SIB, meanwhile, harbours ambitions of inheriting the mantle of a central, monolithic regulator a la SEC.

This was never a satisfactory state of affairs, steadily debilitating the already unsatsifactory public image of City regulation. But until very recently the frictions were at least relatively contained. Not so now.

Clearly alarmed about the prospect of a full-throated attack on its competence from Imro before the Treasury and Civil Service Committee on Wednesday, the SIB's wheels began to turn a little more swiftly than usual. The fact that, contrary to expectations, the microphones failed to ignite as expected prompts ugly suspicions of what happened behind the scenes to ward off this much heralded strike. It appears that the SIB's most vehement critic, Phillip Thorpe, was told to "shut up or be put down", in a variant of that now modish phrase for the belligerently inclined.

Charles Nunneley, his chairman, and head of asset management at Flemings, left him so little air it was difficult to breath. According to Mr Thorpe he was warned off. Now that the row has become so public, it seems scarcely conceivable that both can remain. Mr Large and Mr Nunneley are the same men who argue passionately in favour of transparency and openness in the City; it is they who say regulation is all about public confidence and credibility. Oh dear.