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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Press Releases: 08/12/2004 - EMAG petitions European Parliament to bring Gordon Brown and the Treasury to book on Equitable Life.

EMAG petitions European Parliament to bring Gordon Brown and the Treasury to book on Equitable Life.

EMAG today asked the European Commission to institute legal proceedings against the UK government for failing to protect European citizens enmeshed in the Equitable Life scandal.

In Brussels today, EMAG's general secretary, Paul Braithwaite, together with the Liberal Democrat shadow Treasury team MEP, Chris Huhne, handed in a ground-breaking petition to the European Parliament. It requests the Commission to institute legal proceedings against the UK government for failing to protect citizens throughout Europe in the Equitable Life scandal.


(Photo: European Parliament)

Paul Braithwaite said:

"Despite Gordon Brown's fine words about honouring promises and his patronising, superior stance towards Europe, the Equitable saga shows that when stress-tested UK regulators failed to protect policyholders. European directives require redress when regulation fails. No remedy after four years proves there's no political will to honour the obligations imposed by directives."

Embarrassingly, as Britain prepares to take on the EU presidency, EMAG is petitioning the Parliament to pursue the UK government for infringing Community law by failing to implement EC directives and is seeking prompt action to achieve redress and restore confidence in the single market.

Chris Huhne MEP said:

"The Equitable Life scandal is not going to go away. The Treasury had a duty of care to regulate financial services institutions properly and in accordance with its EU single market commitments. It now has a clear case to answer."

Over three years have passed since the savage 4,000m cuts in policy values affected more than one million investors at Equitable. EMAG believes the cuts were necessitated by more than a decade of lax regulation under both Tories and Labour. In consequence, 50,000 annuitants across Europe are today living with incomes reduced by a third and the unenviable prospect of being locked into declining annuities for the foreseeable future.

Colin Slater, chairman of EMAG said:

"The Treasury commissioned reports and review after review, but it was all just cynical, evasive action. Even the new study by the Parliamentary Ombudsman, which the Treasury vociferously resisted, cannot look into vital areas and won't address the losses suffered by an estimated 100,000 investors who are foreign residents, the majority of whom live in other European member states."

EMAG maintains that for years the British government has encouraged financial institutions the play the European single market in life insurance on both sides. They took advantage of the single market for UK insurers to sell all around Europe (known as 'passporting'), on the basis of the legal rights of policyholders under UK law, but they violated EC directives with their 'light touch' regulation. There has been systemic regulatory failure which has left Equitable's policyholders in the dark and in the lurch.

Tom Lake, EMAG's deputy chair and author of the petition said:

"At the European level, we question whether the much-amended UK insurance law, with its disastrous reliance on the discredited guidance of the Institute of Actuaries, came anywhere near to the requirement of the EC directives. That's why EMAG is appealing to the higher authority of the Parliament to restore confidence in this vital area, if Europe is not to slide backwards from the single market."

The full 44-page petition is available free at: www.emag.org.uk