9 billion pounds: UK banks’ compensation for mis-selling insurance
Last week just as my Twitter feeds got active with links to the British Lloyds Banking Group blinking in its fight with the regulator, the Financial Services Authority (FSA), and agreeing to a £3.2 billion (Rs 23,427 crore) provision to meet insurance mis-selling claims, we at Mint were following the PricewaterhouseCoopers story. Mint reported that while global investors (including pension funds from the US, the UK, Norway and Denmark) in Satyam were to be compensated by the auditor found guilty of not following basic rules of an audit, Indian investors will get not a paisa (http://bit.ly/j9Zbg2). The Indian story was about a lack of clear regulatory jurisdiction, archaic laws and the inability to take tough decisions against large corporations. The British story was about consumer agencies active enough to push the regulator into action, the legal system providing the platform to do this and the institutional will to actually go ahead with a decision to punish that will make markets fall.