Obama seeks 'transformation' of US financial regulation

Barack Obama has unveiled sweeping, landmark reforms of the United States financial system in a bid to prevent such a powerful recession from striking again.

The US president said the reforms, which would create a regulator for the country's banks and force them to put huge swathes of cash aside to prepare for emergent crises, were the most ambitious since the Great Depression.

"We did not choose how this crisis began. But we do have a choice in the legacy this crisis leaves behind," Mr Obama said today.

As well as new regulatory powers for the Federal Reserve, the president is proposing a new treasury-led financial services oversight committee and a new watchdog focusing on consumer products.

"With the reforms we are proposing today, we seek to put in place rules that will allow our markets to promote innovation while discouraging abuse," Mr Obama added ahead of the reforms going to Congress for debate.

"We seek to create a framework in which markets can function freely and fairly, without the fragility which in normal business cycles bring the risk of financial collapse, a system that works for businesses and consumers."