No date set for Equitable report
The Financial Services Authority says the internal inquiry into collapsed insurer Equitable Life is set to be completed this summer, but admits that it does not know when it will be handed over to the Treasury.
A spokesperson for the FSA told Accountancy Agethe independent review team was expected to complete its inquiry ‘sometime during the summer’.
‘Once the review is complete it will be passed on to the FSA board for approval before being handed to the Treasury. But I cannot say when this will take place,’ she added.
An article in today’s FT claimed the report would only come out at the end of October, one month before N2, the date the FSA assumes its full powers under the Financial Services and Markets Act. Yesterday economic secretary to the Treasury, Ruth Kelly, said the date for N2 would be 30 November.
The Equitable Life review team is lead by Ronnie Baird, the director of internal audit at the FSA, with accountants from PricewaterhouseCoopers and lawyers from Norton Rose
The inquiry is investigating the circumstances surrounding the insurer’s collapse. In December Equitable stopped writing new business and is now operating as a closed fund after a House of Lords judgement in July ruled its decision to cut terminal pensions bonuses to holders of guaranteed annuity rate policies was illegal.
The insurer appointed lawyers at Herbert Smith to investigate the role played by the FSA, the DTI and Equitable’s former executives who resigned over the crisis, to see if any legal action could be taken against them.
The FSA itself has not emerged unscathed. Earlier this week parliamentary commissioner for administration, Michael Buckley warned he had received complaints about the ‘alleged failure’ of regulatory bodies, including the FSA, to exercise adequate supervision over the affairs of the insurer, and has only postponed his investigation until after the report is published.
Links
Regulators warned over Equitable
Treasury committee slams Equitable audit