The Impact of Reserve Requirements on Banks

Banks grew their deposit liabilities from $1.5 trillion approximately to $7.5 trillion. When they should have had a 10% reserve requirement, they had less than $40 billion. This happened from a 25-year period from 1980 to 2007,. How could the regulator not catch on? In fact, I've read papers in the early 2000s from the Fed stating that the reserve requirements are pretty much nonsense.