Exclusive: Equitable report ‘incomplete’

Equitable chairman Vanni Treves told policyholders two weeks ago that City lawyers Herbert smith were writing to Ernst & Young, asking it to explain the ‘serious concerns’ raised by PricewaterhouseCoopers, contributors to the study, over E&Y’s work at the life assurer.

But E&Y has still not received the letter or details of the concerns, and it is believed both Herbert Smith and PwC are now trying to distance themselves from Equitable’s statements. A source said: ‘The actual report has not been completed’.

E&Y partner Robert Holman said: ‘Neither PwC nor Herbert Smith have made any contact with the firm during their enquiry, and to date we have not received the enquiry letter referred to in the Equitable Life press release issued on 29 November.’

E&Y has always defended the quality of its audit of Equitable, which closed for new business a year ago following uncertainty over its guaranteed annuity rates.Policy holders have now been asked by Treves to approve a compromise scheme that would release Equitable from massive future financial commitments.

Herbert Smith was brought in by Equitable’s new board to see if there were any grounds for legal action against former directors and advisers at the society.Forensic accountants from PwC, Equitable’s new auditor, were used to look at E&Y’s work.

A spokesperson for Equitable refused to make any further comment. ‘We are not saying anything other than what was contained in the press statement.’Both Herbert Smith and PwC declined to comment.


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