UK - The Financial Services Authority (FSA) has admitted that "a number of issues could have been better handled", following the release of a report pointing to its role in the demise of former mutual, Equitable Life.
The Baird Report* points to a number of FSA shortcomings and makes several recommendations to be implemented and reported on by November 20, at the request of the Treasury.
The FSA said: “We recognise that the review makes pertinent criticisms of various aspects of the management of both the prudential and conduct of business regulation of Equitable Life by the Authority.
“With the benefit of hindsight it is clear that a number of issues could have been better handled, and we will take those lessons to heart.”
However, the report conceded that when the FSA took over as regulator in January 1999, the “die was cast” and “nothing which the FSA could have done thereafter … would have mitigated, in any material way” either the outcome of the Court case or the final outcome as far as Equitable Life is concerned.
The FSA draws attention to issues highlighted in the report that it says it has already addressed, including the issue of prudential and conduct of business regulation. But the Authority admits that there is still work left to be done regarding prudential standards and regulatory reporting. The FSA is also waiting on further scrutiny by the Penrose report.
New projects are to be directed by John Tiner, the FSA’s managing director.
By Madhu Kalia
*The Baird Report - “The Regulation of Equitable Life – an independent report” - by Ronnie Baird, Director, Quality Assurance and Internal Audit, FSA.
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