Subject: Note from Mike Fenwick - per t/call with Jill Insley Date: 05/07/05 11:33:26 GMT Daylight Time Reply To: To: neasa.macerleanobserver.co.uk CC: jill.insleyobserver.co.uk

Neasa ........

Since leaving a telephone message on your voice mail - I have had a short discussion with Jill Insley and agreed to send two e-mails to you as an introduction.

Jill in her article said the circumstances raised questions about the role of the FSA.

Here are some of my questions :

Have we been witnessing the largest "lifeboat operation" ever mounted in the financial services industry or a "cover up" of simply massive proportions?

What caused the massive de-mutualisation in the industry - and the run for cover by way of outside capital?

What caused the series of large scale mergers - such as Norwich Union, General Accident and Commercial Union, or Royal and Sun Alliance?

Was it a "lifeboat operation" and would therefore the FSA - once the lifeboat reached calmer waters - be obliged on their part to instigate a "time bar"?

What actually sank Equitable Life - the GAR position or "over-bonusing" .......and why did the FSA not ever apparently forsee the possibility that it could not be salvaged?

I attach an article dated 1985 - yes that old - here is what I predicted in the 500 words I used

1 : That terminal bonuses were a terminal illness.

2 : That the industry would lose the confidence of the public.

3 : The need for actuaries to be wholly independent.

4 : The need to assess liabilities on an equal par with assets.

5 : The need for stochastic systems of measurement of future growth.

I then went and "commandeered" responses from the then 9 ASLO offices - and you will find not one disagrees with the problem.

20 years later not one of those offices remains in the same shape or form.

Businesses established to deal with the long term unable to survive the short term.

Who knew? What did they know? When did they know it?

Mike Fenwick ...