Following the publication of the FSA’s internal inquiry into its handling of the Equitable case, the authority has said it will launch ‘an examination of the role in insurance regulation of professional advisers and skilled persons, including auditors, the appointed actuary and actuarial quality assurance’.
But the report stopped short of pointing the finger of blame at Equitable’s auditors, Ernst & Young, instead opting to list a number of lessons to be learnt.
Writing to the Treasury economic secretary Ruth Kelly, who had received the report last week, Howard Davies, head of the FSA, said the review made ‘pertinent criticisms’ of regulation of Equitable by the authority.
‘With the benefit of hindsight it is clear that a number of issues could have been better handled,’ he said.
Howard said a number of plans had been put in place following the collapse of the life assurer, but added ‘there is much more work to do.’
The inquiry, conducted by the FSA’s head of internal audit Ronnie Baird with the help of PwC and Norton Rose, was set up after Equitable closed for new business in December 2000 following the House of Lords judgement on guaranteed annuity rates.
In August this year, after mounting pressure from action groups, the government set up its own enquiry, chaired by Lord Penrose, who will have a far wider remit and will be able to go back several decades.But Ruth Kelly today conceded the Penrose report would not seek to apportion any blame.
Instead, she said it would be up to policy holders and the current directors of Equitable to pursue any action against former directors and advisers.
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Accountant to lead Equitable probe