City regulator takes action against former Co-op Bank directors It is thought that the probe is looking at members of the bank's management team, led by interim chief executive Barry Tootell until May this year, as well as its board, whose members included then group chief executive Peter Marks. The investigation is believed to have begun before the latest revelations surrounding Mr Flowers, who stood down in June 2013, but sources indicated has been expedited in light of the intense focus on the situation. Sources confirmed that the FCA is looking at enforcement action against individuals, but emphasised that no final decisions had yet been made. The FCA investigation will run in parallel with the existing inquiry being carried out by West Yorkshire Police into the drug-related allegations surrounding Mr Flowers. Once both are complete, a Treasury-initiated inquiry into the near-collapse of the bank and its directors will begin. David Cameron said during Prime Minister's questions on Wednesday that "the Chancellor will discuss with regulators what is the right form of inquiry." It is understood that the terms of an inquiry under the Financial Services Act 2012 will be announced within days - although the inquiry will not be able to start until both the other investigations are complete. Andrew Tyrie, chairman of the Treasury Select Committee which is already holding its own investigation in to the Co-op Bank, said that the review should be chaired by an independent person. "The authorities cannot be seen to be marking their own work," he added. The independent inquiry will involve both the FCA and the Prudential Regulation Authority, and look closely at their predecessor, the Financial Services Authority. It was the FSA which was responsible for approving Mr Flowers to sit as a non-executive director on the board of the Co-op Bank in May 2009, and then green-lighted his move up to chairman a year later. Mr Cameron emphasised that the Government's "first priority is to safeguard the bank, and to make sure it's safeguarded without using taxpayer's money." Sources indicated that one of the reasons the Treasury had been reluctant to announce a full-scale inquiry was for fear of adversely affecting the £1.5bn recapitalisation plan for the bank, which is subject to a series of bondholder votes on December 11. Mr Cameron's comments echoed those of Vince Cable, the Business Secretary, who earlier in the day said that the events at the Co-op were a "serious failure of regulation," adding that "mistakes were made." Speaking on BBC Radio 5 Live, Mr Cable went on to emphasise that as a result of the recapitalisation plan - which will see vulture funds take control of 35pc of Co-op's equity - he has the power to stop the bank from using the "co-operative" name if he feels it is no longer appropriate. He has yet to make a decision, however. The inquiry comes amid reports that Chancellor George Osborne pressed Brussels last year to spare the Co-op Bank from tougher rules applied to big listed banks. The Chancellor's bid to win more lenient capital treatment for the Co-op came at a 2am negotiating session between finance ministers in May, shortly after he angrily criticised special carveouts, according to the reports. Treasury, FCA and PRA spokesmen declined to comment.