The British parliamentary ombudsman has decided to investigate the actions of the Financial Services Authority (FSA) regulator between January 1st, 1999, when it took over regulation of Equitable, and December 8th, 2000, when the company closed for new business.
Compensation for regulatory failure may be possible. While an outcome is a good way off, a recent internal FSA report concluded its staff was overly influenced by the confidence of Equitable management, said there was poor communication with the regulator, and criticised the FSA handling of a reinsurance deal that maintained Equitable's solvency.
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