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Equitable Outcome for Debt-Ridden Pension Holders

by enrico

Equitable Life promised money that it couldn't afford, building a
house of cards that would capitulate in 2000. Throughout the
1990s, the life insurance company promised so much and would
eventually deliver so little when the company's assets were
valued at 3 billion pounds less than the customers' policies.

Ann Abraham, Parliamentary Ombudsman for the Equitable Life
debacle has declared that the government should admit negligence
for their part. The government is accused of not monitoring the
'dubious practices' that have subsequently been discovered,
including naming future profits as viable assets.

Ms Abraham stated clear intentions in her report that the
government should refund those that were affected by what she
labels as 'injustice' and 'maladministration'. She suggests that
the policy-holders should be offered compensation to reposition
them into the position in which they were before the Equitable
Life collapse.

Since the near collapse of Equitable Life in 2000, the
executives of the company were replaced by a new group. New
chairman Vanni Treves agreed with the Ombudsman's report and
welcomed the recommendation of a goverment compensation fund,
saying 'The government should now pay up.'

After eight years of a seeming lack of responsibility, the
government will be called upon to admit a level of liability. As
Equitable Life continued to overvalue its own assets, the
Government Actuary's Department and the Department of Trade and
Industry were wholly inefficient in doing their job.

These two departments ignored such malpractices as Roy Ranson
becoming chief executive and appointed actuary of Equitable Life,
allowing him almost complete control of a 30 billion pound
pension fund. Equitable Life have repaid the policy holders that
were laden with a debt, admitting responsibility for their
failings.

The Penrose Report of 2004 investigating the claims of the
affected policy-holders directed much criticism to the Treasury
and the Department of Trade and Industry. This leads us to
question why it is four years later and the government is still
being pressured into admitting responsibility.

Following the publication of the Parliamentary Ombudsman's
report, the Treasury is expected to 'provide a full response to
the House in the autumn.' As campaigners await the official
response, it is expected that the government will be unable to
deflect this obvious indictment and condemnation. Or so it would
seem.

To the unaffected neutral, it would appear that a complete lack
of regulation, combined with Ranson's autocratic running of the
pension company led to its inevitable demise. Equitable Life have
paid up so now we must wait for the government to put their hands
in their very deep pockets and justice will be served.

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