EQUITABLE LIFE is going to be in the firing line over the next two days, as further information abou...
EQUITABLE LIFE is going to be in the firing line over the next two days, as further information about its financial status - prior to collapse - emerges.
The Times leads its business section with news that an Equitable policyholders action group has accused former management of running the insurer like a pyramid investment scheme, also claiming that its with-profits fund had sustained a £1 billion "black hole" throughout the 1990s.
Policyholders have submitted a report to the Penrose enquiry arguing that Equitable management consistently ran the with-profits fund so that policy values were worth £1bn or more than the actual assets held.
In a report submitted to the Penrose inquiry into the insurer, the Equitable Members Action Group (EMAG) claims that the former management ran the fund so that the policy values were consistently worth £1 billion more than the assets, so the fund was already in deficit before the guarantee episode blew up.
A REPORT in the Daily Telegraph suggests the black hole may have been worth £2bn during the 90s, based on the figures quoted by chartered accountancy firm Burgess Hodgson.
As a result of Equitable's collapse, EMAG is demanding compensation from the Treasury and Department for Trade, because they were the bodies responsible for regulating Equitable before the FSA took over in 1999.
Pressure is on the government again to scrap plans for what is seen as a "stealth tax" on businesses handed over to children, adds the Times.
Tim Yeo, Shadow Trade and Industry Secretary, points out that plans to abolish capital gains tax relief on shares handed to children argues it sends the wrong signal to businesses in Britain if it wants entrepreneurs to continue to operate in the UK.
Boardroom pay is under scrutiny again this morning, as both Pearson and Aviva get the treatment.
According to the Times, directors of Aviva - the parent group behind Norwich Union - received performance bonuses totalling more than £2.3m last year despite a sharp fall in the share price and a hefty dividend cut.
In addition, directors also received increases to their basic pay, so Richard Harvey, chief executive, was lifted to £1.4 million from £978,000 a year earlier while his basic pay rose by 8%, along with fellow board directors.
And yet more news to upset the workers reveals co-chairman of Unilever, Niall Fitzgerald , has managed to build up a pension worth £11.7m over 27 years, says the Telegraph.
This would effectively give Fitzgerald, now aged 57, the ability to draw a pension of £718,000 a year, but this amount could rise further before he reaches Unilever's retirement age of 60.
Caring for children and elderly relatives
Similar to June 2007
Square Mile’s series of informal interviews
Fine reduced to £60,000
Two roles created