The UK's financial watchdog, the Financial Services Authority (FSA), is seeking more powers to help it crack down on corporate abuses.

The FSA wants to increase its powers to enable it to investigate firms suspected of breaking accounting rules, sources close to the situation told BBC News Online.

The government is keen to toughen up accounting regulation to prevent the possibility of any Enron or WorldCom-style corporate scandals in the UK.

The cases hit investor confidence and contributed to sliding share prices last year.

Greater role

Currently, investigations of possible accounting breaches are carried out by the Financial Reporting Review Panel (FRRP), which reports to the Department of Trade & Industry (DTI).

But the FRRP is much smaller than the FSA, and the FSA is thought to want to take a much more aggressive role in clamping down on abuses.

The FSA is seeking to take over responsibility for assessing where risks may lie, and for investigating the companies under suspicion.

However, the FSA is not seeking to gain powers of enforcement over those companies found guilty of wrongdoing.

Critical

The FSA has been criticised for not being active enough over the financial crisis at life assurer Equitable Life.

And in November, MPs on the Treasury Select Committee were strongly critical of the role of the FSA after many people lost money through split-capital investment trusts.

The FSA's chairman Howard Davis announced in December that he was to stand down from his post in September this year to become director of London School of Economics and Political Science.

His successor has yet to be named.