Former Taoiseach John Bruton has told the European Insurance Industry Forum that it is time to rein in regulation.
He said industry cannot go on diverting resources and human talent into compliance requirements that are ever more complicated.
However he said the increase in regulation was in large measure down to a failure on the part of people involved in business, and especially in financial services, to think and act in an ethical fashion.
In an interview with RTÉ News, Mr Bruton said he accepted the need for regulation and recognised the "huge problems" in the industry, but he said it was not sustainable to rely on regulation alone.
Last week former NTMA boss Dr Michael Somers said firms were starting to leave the IFSC in Dublin because of excessive regulation.
Yesterday Central Bank deputy governor Matthew Elderfield told the same insurance industry forum that the cost of bailing out Quinn Insurance was eighty times more than the annual cost of regulating the insurance industry, while the bank bailout cost more than 1,400 times the cost burden of regulating the banking industry.
Mr Bruton - who represents the IFSC as an international "ambassador" - said the increased regulatory response was not simply an Irish problem, but an international one.
He compared the 37 page Glas-Steagal Act - brought in to regulate US banking in the wake of the Wall Street crash and 1930s depression - with its 21st century equivalent, the Dodd-Frank Act, that was introduced in the wake of the financial crisis that followed the collapse of Lehman Brothers, which runs to some 848 pages.
He said such regulatory burdens would not be needed if "there was more emphasis on ethical judgement in business, if people took ethical decisions and accepted responsibility for them".
He said it was up to business to prove the case for less regulation to a sceptical public.
He said while there were always disagreements between regulators and the industries they supervised, he did not think Dr Somers comments should be blown out of proportion.
He said the most important safeguard for the IFSC was the establishment of a European Banking Union, which would create a level playing field for the financial services industry across all EU states.
Without it the risk was that financial services would become concentrated in three or four big states that have a big tax base.
Without such a union, he said they would act as a backstop to any problems the financial industry would run into, whereas the smaller states would have to rely on ever higher levels of regulation to try and eliminate risk they could not afford.