EMAG

The independent action group for current and ex Equitable Life policyholders, funded by contributions.

Equitable Members Action Group

Equitable Members Action Group Limited, a company limited by guarantee, number 5471535 registered in the UK

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Documents: 17/07/2003 - EMAG at FSA's annual meeting: Questions asked at the AGM

17 July '03 - EMAG at FSA's annual meeting: Questions asked at the AGM

Alex Henney:

The year 2000 highlighted a clear conflict between the FSA's attempt to avoid telling prospective policyholders the parlous financial state of the Equitable in order to allow it to continue in business, and its duty to fulfil the reasonable expectations of prospective policyholders. Does the FSA agree that responsibility for conduct of business issues should be divested to an entirely separate statutory body over which it has no control at all? This would be similar to the split between Ofgem and Energywatch.

Leslie Seymour, re Internationals:

I have complained to the Belgian regulator and the EC about mis-selling of UK financial products in Belgium and I have claimed compensation for my consequential severe losses.

The Belgian regulator, "Office de controle des assurance", and an EU commissioner, Frits Bollenstein, have both written to state that the UK regulator is the relevant "national supervisory body".

I have complained to this "national supervisory body", the FSA, and. I wish to take my complaint to the national courts.

However I find that, contrary to the European third life directive, this "national supervisory body", against which I should be able to make a claim, has crown immunity. This is scandalous.

I also find that even the UK PO refuses to investigate the relevant periods of the mis-selling, while in other European countries, such as France and Germany, the financial regulators are taken to task by the courts for negligence.

The UK situation is a travesty of the European insurance directives. Far from creating the necessary confidence in European insurance, it clearly identifies that UK member state's insurance regulation avoids accountability via the courts and other judicial bodies.
Can you please explain EXACTLY who the FSA IS accountable to, as I
believe that neither the PO nor the National Audits Bureau nor the courts have any jurisdiction?

Futher, what steps are in hand to harmonise regulatory framework within the EC to restore the disastrous loss of confidence in the insurance sector?"

Paul Braithwaite:

As a long-standing Equitable Life policyholder activist with the Equitable Members' Action Group (EMAG), I am concerned that the apparent level of involvement of the FSA into strategic decisions seeming to exceed what is reasonable for a so-called 'light touch' regulator.

By way of examples I would cite:
1. the counsel's opinion of Glick and Snowden Sept 2001 - must have been commissioned weeks before members were given Nicholas Warren's opinion that it addresses
2. The FSA received the so-called independent actuarial review by Bacon and Woodrow months before members in summer 2002, enabling the Moss and Carr opinion on compensation for late-joiners who left to be commissioned by ELAS
3. The FSA has permitted Equitable to freeze unilaterally the GAR rectification scheme required by the House of Lords. Is this even legal? It's in defiance the highest court in the land.
4. The FSA has granted a waiver to Equitable to delay addressing the 50,000 cases of possible drawdown mis-selling until the end of next year.
5. The FSA is widely believed to have been the architect of the now aborted second Section 425 scheme of arrangement, now aborted, that was used for six months as an excuse to delay thousands of complaints at the FOS.
6. I'm concerned that the FSA is applying pressure on the FOS on Equitable complaints (per MOU) and is implicitly endorsing the offer of June 5th to 16,000, without awaiting quantum to be determined by the FOS
7. Equitable has £900 million in provisions and yet, with the FSA's complicit agreement, almost none of the various rectification schemes are being progressed - presumably to preserve cash and minimise payments.

In summary, EMAG suggests that the FSA may be acting as a shadow director of Equitable Life, well beyond its formal remit.

Chris Carnaghan:

Most members of the public probably think, as I did, that the Financial Ombudsman Service is an independent organisation whose sole role is to protect consumers. When I read the Memorandum of Understanding between the FOS and the FSA I realised that this is not the case.

The MOU gives the FSA substantial control over the FOS (e.g. by appointment of directors, approval of budgets, early disclosure of information by the FOS, etc), which seems uncomfortably incestuous.

While this may be convenient for the FSA, surely this degree of control militates against the independence of the FOS when adjudicating on consumers' complaints that might, on occasions, be in conflict with the FSA's other interests and commitments?

In order to fulfil its consumer protection role without prejudice the FOS should be entirely independent of the FSA.

Rodney Allen:

Why was the FSA in complete disarray on the 19th and 20th July 2000 and why knowing that fundamental incurance principles had been set aside did they not intervene at government level to have the H of L's ring-fencing decision placed on hold by one means or another

If the FSA believe that the maintenance of confidence in the financial system relies on the public perception that investors are properly protected, is not the PO's report into ELAS totally counter-productive, with the appearance of an establishment whitewash, given that it is FAR less critical of the FSA than your own internal Ronnie Baird report?

Gabrielle de Pauw:

I have the misfortune to be an Equitable Life with-profits annuitant and I have been worried sick about my pension every day for the last two years. My income has just gone down, not by 20% but by 29% and I understand that There are definately more cuts to come. My question is:

EXACTLY what has the FSA EVER done to protect Equitable Life policyholders?

Because, frankly, I'm more and more inclined to agree with what Broadcaster Libby Purves wrote in the Times two years ago about the FSA's regulation of Equitable Life, and I quote:

"Am I alone in wondering whether it might not be more effective to replace Sir Howard Davies's Financial Services Authority with a lucky rabbit's foot and a bunch of white heather? Or perhaps a chocolate teapot?"

I repeat: What, exactly, has the FSA ever done to protect Equitable Life policyholders?"