The Equitable Life Assurance Society - Reports By The Actuarial Profession and FSA

Reports By The Actuarial Profession and FSA

In May 2001 Ian Glick QC and Richard Snowden published their joint opinion on behalf of the Financial Services Authority. This concluded that there was an arguable case that the Equitable had breached the rules of its former regulators, the Life Assurance and Unit Trust Regulatory Organisation (Lautro) and the Personal Investment Authority (PIA) in failing to disclose the risk of the existing GAR policies in the Product Particulars, Key Features and With-Profits Guide to new non-GAR policy holders.

This was followed in September by the Corley Report on behalf of the Institute of Actuaries which recommended amongst other things that the Appointed Actuary should require that there is a process for reviewing communications to policyholders, should resist holding a dual role as Chief Executive and that his work should be subject to peer review.

In October, the Baird report was published. This covered the FSA's regulation of Equitable from 1 January 1999 to 8 December 2000 when the Society closed to new business and was produced by the FSA's director of internal audit with the help of independent accountants and lawyers. The review found that - with hindsight - there had been some "deficiencies" on the part of FSA in the discharge of their regulatory responsibilities, but also stated that "the die had been cast" by the time the FSA had assumed regulatory responsibility for the Society in relation to those who had already invested in Equitable.