Does the food and drug administration know of the illnesses that are caused by the now regulated food industry?

Absolutely. As an example, the US FDA lists 92 side effects of the food additive "Aspartame". Aspartame is a food additive with the FDA classification of GRAS, which means "generally regarded as safe".

Reporting side effects or illnesses caused by food to the FDA could be argued as being pointless. However, keeping silent most assuredly would produce no desirable results.

The FDA has in place, procedures to address illnesses caused from food. You can learn about how the FDA handles product recalls directly from this URL http://www.fda.gov/consumer/updates/recalls123107.html