Equitable: hold out for the money

THE Government may have ruled out compensation for victims of the Equitable Life scandal but solicitors responsible for several significant recent compensation gains say they should still pursue claims.

Robert Morfee, financial services partner with law firm Clarke Willmott, insists that the question is not whether the regulators owe policyholders compensation but how much.

'The regulators failed to ensure there were reserves. Money that should have been held back as reserves was distributed in bonuses.

'The regulator also has a case to answer for mis-selling. Its shameless encouragement of investors to vote for the compromise scheme of 2002, where many investors gave away their only real hope of compensation for a marginally increased share in a failed and failing life fund. That chicken has yet to come home to roost.'

Clarke Willmott has achieved payments of over £250,000 in damages in seven cases with Equitable Life.

'We have demonstrated that these are cases of mis-selling, rather than mere fund underperformance,' added Morfee.

'We know that policyholders were told the Equitable‘s with-profits fund was blue chip, promising high security for their money, with better-than-average prospects for growth. That was not true, unknown to the salesmen.

'Large numbers of these policies were unsuitable for the individuals' needs and Equitable Life‘s settlements show that in such cases the company accepts that compensation should be paid in excess of its current offers.

'Time is passing and many who were sold policies after September 1998 will soon be losing their rights to claim. Policyholders should seek legal advice as to their current options.'