WASHINGTON -- The two leading architects of the financial bailout made the case Thursday that Congress must give regulators more power to curb risk-taking on Wall Street.

Treasury Secretary Timothy Geithner told a special panel investigating the financial crisis that the government should have acted more aggressively ahead of the crisis. He used his testimony to push for the Obama administration's financial regulatory overhaul, which has reached a critical point in the Senate.

His predecessor, Henry Paulson, also told the Financial Crisis Inquiry Commission that a reworking of the regulatory system was needed. But Paulson, who led the Bush administration's response to the crisis in 2008, cautioned that overly stringent regulation could stifle innovation.

Geithner testified that the financial crisis could have been "less severe" if the government had moved faster to limit the damage. When he became the Obama administration's Treasury secretary, Geithner continued the $700 billion bailout program for the financial system that began under Paulson.

The bipartisan inquiry panel, chartered by Congress, is examining the origins of the crisis.

A fundamental cause of the crisis, Geithner insisted: the lack of authority for regulators to restrain risk-taking by financial firms operating outside traditional rules. The legislation before Congress would help fix that by giving regulators authority over firms in the so-called "shadow" banking system, he said.

He pressed the need for new rules for financial institutions, such as requiring them to hold larger capital cushions.

"We're still living with the same system that produced this crisis," Geithner said. "Without reform, the system will be more vulnerable, less stable, than in the past."