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FSA denies Equitable report is facing delay

Confusion reigns over when the FSA&#39s report into its handling of the

Equitable Life debacle will be published.

The Treasury says the report has yet to be completed but the regulator

says it is on track and the Government will decide when to release it.

The news comes as pressure on all parties involved with Equitable

continues to escalate following this week&#39s massive cut in pension fund

values.

Treasury economic secretary Ruth Kelly said in an answer to a

Parliamentary question last week “the review team is not yet in a position

to complete its report”.

But the FSA says there is no delay as far as it is aware and the report is

due to be completed this summer as originally announced in December.

Equitable has come under fire yet again from IFAs for mismanaging its

with-profits fund, leading to the cut in fund values. They claim it

overpaid bonuses and exaggerated fund values compared with the underlying

returns.

IFAs say the current extent of policyholder disillusionment will

jeopardise the chance of a guaranteed annuity rate compromise, which could

then put the next stage of the Halifax deal under threat.

Annuities Direct director Stuart Bayliss says: “This problem exists,

regardless of GARs. It is about ongoing mismanagement and exaggerating true

fund values. Efforts should be redoubled on the culpability of former

advisers and management.

“Declaring the final value was not about clarity or openness, it was about

increasing sales.”

FSA spokesman Andy Fleming says: “The review is expected to be completed

by the summer and publication is a matter for the Treasury.”

Fund values cut, p2

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