PracticeConsultingRegulators warned over Equitable

Regulators warned over Equitable

The parliamentary ombudsman has warned he has postponed and not abandoned his inquiry into whether authorities made mistakes over last year's crisis at life insurer Equitable Life.

Parliamentary commissioner for administration, Michael Buckley, revealed in his annual report that he has just started to receive complaints about the ‘alleged failure’ of the regulatory bodies to exercise adequate supervision over the affairs of the insurers.

And he pointed fingers at the Department of Trade and Industry, the Treasury and the Financial Services Authority insofar as it acted on the Treasury’s behalf.

Buckley said in his foreword: ‘I decided to postpone a decision on whether there were aspects of these bodies’ handling of the affair which I might usefully investigate until the report of the investigation being undertaken by the FSA was available.’

He said he was mindful of the limitation of the FSA’s remit and the expectations the public and MPs ‘rightly’ have about independent investigations.

He hoped the outcome might serve to indicate those areas which warrant further scrutiny – if any – and said he would make a decision later this year or early next.

Buckley also expressed concern about the way ‘departments are putting increased burdens upon citizens – for example, through self assessment of income tax’.

He said those failing to complete tasks faced penalties, while the departments themselves had generous periods of time to carry out their own functions with only token redress for overstepping those periods.

His report revealed that complaints against the Inland Revenue have shot up from 134 the previous year to 214, but said this increase included complaints over the NIRS2 computer fiasco involving National Insurance Contributions which the IR took over from the Department of Social Security.

Since 8 December 1999 Equitable Life, the worlds oldest mutual life assurer has ceased to write new business and operated only as a closed fund. In July last year, the House of Lords ruled its decision to cut terminal pensions bonuses to holders of guaranteed annuity rate policies was illegal.

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Equitable Life probe to include auditors

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