Legal And General Breaches Of Rules

EDM number 871 in 1993-94, proposed by DN Campbell-Savours on 16/03/1994.

That this House notes the extraordinary appointment as Chairman of the Personal Investment Authority in September 1993 of Mr Joe Palmer, former Chief Executive of the Legal and General between 1984 and September 1991; further notes that Mr Palmer was Legal and General Chief Executive at a time when an investigation carried out by Legal and General into its own sales organisation, found widespread rule breaches by its own sales consultants; further notes that an internal memo of 23rd November 1990 to J. M. Kidner, Director of Financial Consultancy, found Legal and General trading practices which breached LAUTRO paragraph 7 rules were extremely widespread throughout consultancy; notes that this investigation followed upon interviews with Rowab Ullah, a Legal and General salesman, which revealed that Legal and General senior staff in breach of LAUTRO rules abused their position by signing off business done by unauthorised representatives; notes that the internal memo reveals consultants were immediately allowed to sell without any licensing or authorisation and that it was totally impossible to justify doing this for years and that Ullah managed to carry on for two years without passing any exam during the course of which he was selling quite complicated business; notes that the memo states that loads of cases have been sold here without anybody who actually did the selling or the authorising having passed any examinations of any sort and that the memo alerts the company to the possibility of disciplinary action and possibly even intervention by LAUTRO in the event that LAUTRO were to discover the true situation.

This motion has been signed by a total of 26 MPs.