Lloyd's Names to sue Treasury

SIX dissident Lloyd's investors are pressing ahead with a claim for £7 million damages against the Treasury, alleging failure by the Government to properly regulate the insurance market.

This follows the disclosure that the European Commission might drop its inquiry into Britain's alleged failure to regulate Lloyd's. Commission officials have written to the investors - known as Names - saying they believe that regulation of Lloyd's is now up to EC standards.

But the Names say that during the EC's preliminary legal proceedings against the Government, enough evidence emerged to support their demand for compensation.

They allege that statements during the investigation have backed their claim that regulation at Lloyd's was not in line with European standards, and that a failure to conduct a proper audit of the market meant they had been recruited on a false basis.