Angry MPs say City watchdog should install an independent chair of embattled insurer LV
The City watchdog should install an independent chair of embattled insurer LV, say angry MPs.
A botched sale to private equity firm Bain Capital has left LV’s 1.2million members in limbo and has forced chairman Alan Cook to step down in April.
LV had tried to push through the takeover on the premise it could not survive as a standalone mutual.
Writing on the wall: A botched sale to private equity firm Bain Capital has left LV’s 1.2million members in limbo
But in a sharp U-turn, LV said it was a sustainable business on its own, as it dropped separate merger talks with rival Royal London.
The debacle has raised questions over the Financial Conduct Authority which gave the Bain deal the green light.
Labour MP Gareth Thomas, chair of the parliamentary group on mutuals, said: ‘It appears the FCA is either asleep at the wheel or has decided the consumers and owners of LV do not deserve its attention. It suggests the board of LV, despite its obvious inconsistencies, should be allowed to do whatever it wants.
‘A good regulator would demand an independent chair and a board fully committed to mutuality.’
Tory MP Kevin Hollinrake said: ‘The FCA has a responsibility to properly look and decide whether LV contrived the situation with Bain or whether there was a genuine need for it.
The FCA should lean on the board to appoint a chair who believes in mutuality.’ The FCA said: ‘Our role, under the law, was to ensure customers are treated fairly and we challenged the firm to make sure this happened.’
Yesterday it emerged interim chair Seamus Creedon was also due to take a role with Bain if the deal had succeeded, alongside Cook and LV chief executive Mark Hartigan.