Equitable chief escapes lifetime ban

EQUITABLE Life victims expressed outrage that Chris Headdon, one of the two prime movers behind the mutual's near-collapse, looks set to escape a lifetime ban from the industry.

The Financial Services Authority has backed away from its initial plans to impose a lifelong exclusion on Headdon, formerly chief executive.

The 47-year-old actuary appealed against the FSA's preliminary notice of a life ban. He is believed to have agreed to a six-year exclusion.

He could return to the financial services industry and attempt to rebuild his lucrative career in 2010 when he will still be aged only 53. But regulators will not automatically allow him back into the business when his ban is over.

The watchdog earlier decided it would not be worthwhile taking action against Roy Ranson, 73, because of his age.

Paul Braithwaite, general secretary of the Equitable Members' Action Group, said: 'Policyholders will be very disappointed.'

Regulatory experts defended the FSA, which can hand out punishments for breaches only under its regime. That began in 1999, when Equitable was already in trouble.

Headdon and Ranson - who would find it hard to make a career comeback in finance - have each amassed large free pensions from Equitable's staff scheme. Their pots of gold remain unscathed so far.

Paul Weir, of the Equitable Late Contributors' Action Group, said: 'The current board should investigate whether they can confiscate their pensions.'

He fears that Equitable's new board would settle out of court on a multi-billion pound lawsuit against former directors including Headdon and Ranson.

Equitable said:'We are vigorously pursuing our very strong claims.'

Headdon, who was one of Equitable's top actuaries, has been under investigation by the FSA for two years over a deal he struck with Dublin reinsurer Ireco that may have painted an unduly rosy picture of the mutual's finances.

Equitable took out a £700m reinsurance contract in 1998. The ban relates to a 'side letter' Headdon wrote in April 2000 telling Ireco that Equitable would claim much less than the full £700m.

The former boss, who is in line for a free pension of £95,900 a year from age 55, is being sued for negligence along with Ranson and other former directors in a multibillion pound claim launched by Equitable's new board. He quit a job at actuarial consultants Hazell Carr this year to fight the FSA.

The FSA refused to comment.