The Federal Reserve Bank is a private corporation. While its mission impacts the public, it is separate and distinct from any government entity. President Obama wants the Fed to serve as the systemic risk regulator. It would serve as the super cop for too big to fail financial institutions, which includes shadow bankers like hedge funds, private equity and sovereign wealth funds.
Note the Fed is private and frequently won't release details regarding its activities. Shadow bankers are notoriously private. The Obama plan has the privates monitoring the privates. President Obama is consistent in catering to the PEU boys (private equity underwriters).
How long before President Obama tells the Fed who can serve and what they should do? Will he ask Ben Bernanke to allow PEU's to hold majority stakes in banks? He doesn't have to. That responsibility will shift to the FDIC, which indicated its strong interest in clarifying ownership rules to appeal to $1 trillion in private equity dry powder.
President Obama wants to restart greed and leverage for the big money boys. His faux regulation might do just that, using the taxpayer's dime of course.