news for Equitable losers - 19 May 2003
by Harry McRandle
EQUITABLE Life has accepted that the UK financial ombudsman has the power
to act on behalf of claimants sold assurance policies through Guernsey.
The news will be welcomed by hundreds of policyholders based in the island
and overseas who are claiming millions of pounds against the beleaguered
They have been awaiting a decision for many months about whether the UK's
Financial Ombudsman Service had jurisdiction to act on their behalf.
The decision is also good news for the Guernsey Financial Services
Commission. It was strongly criticised recently by Margaret Felgate, a
Spanish-based investor speaking on behalf of a group of policyholders, for
failing to take action.
The policyholders who were sold with-profits policies through Guernsey
were previously caught between something of a rock and a hard place.
As previously reported in the Guernsey Press, because the policies were
sold through Bacon and Woodrow's offices outside the UK, Equitable Life
was not prepared to accept that the FOS had jurisdiction.
At the same time, the GFSC believed it did not have the power to intervene
because only an administrative function was carried out in the island.
However, a spokesman for the FOS said last week that apart from finalising
a few details, the principle had been accepted by Equitable Life that the
FOS had jurisdiction over the Guernsey claims.
But the spokesman said that all claims would be reviewed on a 'case by
case' basis and it may be that some will fall outside the basis on which
jurisdiction is accepted.
'If it is established that financial advice has been given to any
policyholder from Guernsey, then these cases may be excluded,' said the
But the good news is that some of the Guernsey policyholders - who include
GFSC director-general Peter Neville - may have their claims added to 'the
The FOS is already pursuing compensation for many thousands of UK-based
claimants who accuse Equitable of, among other things, mis-selling of
'If any of the Guernsey cases can be attached to the lead-case scenario,
then I would imagine that is the course of action likely to be taken,'
said the FOS spokesman.