E&Y faces penalties for Equitable Life role
E&Y is facing a range of punishments, including an unlimited fine for role in Equitable Life affair
Ernst
& Young (E&Y) faces a range of penalties for its role as auditor for
Equitable Life in the
period up to its near-collpase, including an unlimited fine, severe reprimand
and an order to pay costs if the
Accountants’ Joint
Disciplinary Scheme (JDS) tribunal finds against it.
The JDS has has completed a draft report following a four-year investigation
of E&Y. The final version and any penalties to be paid are likely to be
revealed in December, the Guardian reports.
The big four firm is accused of failing to understand key aspects of
Equitable’s business, failing to act with sufficient independence and
objectivity, and approving the insurer’s accounts for several years when they
did not give a true and fair view of its finances.
The JDS has also heard complaints against two E&Y partners, Kevin
McNamara and Richard Combes and sources said the report was likely to be ‘very
lengthy and very interesting’.
Further reading:
Treves: Government must face Equitable cost