A special European Parliament inquiry committee urged the UK to compensate victims of the Equitable Life scandal, which incurred major financial losses for more than a million people. MEPs also said that the EU should put the necessary regulation in place to prevent such cases in the future.
An overwhelming majority of MEPs sitting in a special inquiry committee backed a report by liberal MEP Diana Wallis on 8 May 2007.
The committee assigned the blame to the UK authorities for not implementing EU insurance legislation correctly and added that “the implementation process as a whole was flawed”.
It further stated that many victims of the crisis had “great difficulty to make a complaint and obtain redress”, especially policyholders in Ireland and Germany.
Even though the committee is not in a position to enforce compensation payments, it urged UK authorities to “assume responsibility” and set up a compensation scheme for victims in the UK and abroad.
The report further criticised the Commission’s role in monitoring the application of EU legislation and demanded it should be “more proactive” in the future.
The document underlines that consumer confidence in pension products needs to be fostered and calls for consumer and investor protection to be made a priority in any financial services legislation. MEPs argued that if business is to get the benefit of the single market, consumers must have clear rights too. Businesses must be told that there is “no mobility without liability”.