PracticeAccounting FirmsEquitable crisis deepens for E&Y

Equitable crisis deepens for E&Y

The chances of Ernst & Young facing legal action over its work as auditor at troubled insurer Equitable Life increased today after news emerged that 'serious concerns' had been raised by a forensic report.

Equitable Life revealed it had commissioned forensic accountants at PricewaterhouseCoopers to produce a report on the auditor and hinted the conclusions have not exonerated E&Y in the eyes of the insurer’s new leaders.

A statement from Equitable said its lawyers Herbert Smith had now written to E&Y ‘seeking an explanation’.

Letters have also been sent to 20 former directors also asking them to explain past decisions made at Equitable.

Among the 20 is Chris Headdon, former Equitable FD and appointed actuary, who briefly led the insurer after most of the board members at the time resigned en masse.

Equitable’s statement reads: ‘The forensic accountancy team at PricewaterhouseCoopers looked at the work of the Society’s former auditors Ernst & Young. The PwC report raises serious concerns. Herbert Smith is writing to Ernst & Young seeking an explanation.’

Links

E&Y to face action over Equitable

Mute response to Commons Equitable report

Treasury to grill FSA over Equitable

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