Thursday 26th June 2008
Led by the enigmatic Michael Bright, Independent Insurance was one of the darlings of the City for many years, producing figures which not only seemed to go against market trends, but seemed just too good to be true. Ultimately this proved to be the case with the company suddenly collapsing in 2000 with the loss of hundreds of jobs.
As well as the job losses, the Financial Services Authority was forced to pay £357 million pounds in compensation to those affected by the failure of the group. KPMG was the auditor for the group and as a consequence of their actions prior to the failure of the company, it has been fined £500,000, with over £1 million in costs. Andrew Sayers, who was a partner at KPMG, has personally been fined £5,000 by the industry regulatory body, the Joint Disciplinary Scheme for his role in the affair.
Not only has this affair highlighted the risks associated with investing in the stock market, it has also highlighted that not everything which you read in a company’s report and accounts is always a true reflection of the underlying position. This was a very expensive lesson for a lot of people involved directly and indirectly with Independent Insurance. |
Insurance
.gif)
.gif)
