Having worked in the finance industry developing risk models for clearing houses, I can safely say that the problem is a lot worse than the authors make it out to be.

Regulators across the globe, practically all of whom are wholly ignorant of what they regulate, demand implementations of their tabular formulas which are often highly specific rather than generalized and so become obsolete as quickly as people find gray spots in the formulations and ways to circumvent the intentions of the regulation. Basic it reads more like law than math and it doesn’t work.

That means all costs go to implementing these sub-par models leaving no room for innovation.

In the end, common people will have to foot the bill and regulations will get even worse. Vicious cycle.