UK - Equitable Life has received a multi-million pound compensation claim from more than 700 policyholders.
It is the first court claim against the mutual following its near-collapse in 2000. It has been issued by the Equitable Life Trapped Annuitants, who have seen the value of their pensions drop by up to 40% and are unable to transfer their funds elsewhere.
ELTA has 2000 members but only 731 have paid the £1000 per person charge to pursue the case.
The money will be used to cover the costs of insuring the annuitants against the possibility of losing the case and to pay Bristol law firm Clarke Willmott.
Equitable chief executive Charles Thomson said: “Any unmerited claim served on the society will be defended vigourously in the interests of all members of the with-profits fund whom the board has a duty to protect.”
Equitable believes policyholders’ best hope of compensation is through parliamentary ombudsman Ann Abraham who is reopening her investigation into the regulation of the company.
Abraham’s earlier investigation into the Financial Services Authority’s handling of Equitable found no evidence of maladministration.
Abraham has reopened the case following representations from 1603 former and current policyholders and 211 MPs. She will look at the role played by the Treasury and department of trade and industry – which both regulated the society – and the Government Actuary’s Department.
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