21 January '04 - Minutes of the 35th committee meeting of EMAG

1. The Treasurer's report to mid January was approved. PB noted that on its recent dissolution ELJAG had made a substantial donation to EMAG.
   
   
2. LS reported on his further research on how best to take action against the UK regulators by reference to EU law and institutions. One option is to sue in the High Court on the basis that an E U Directive has not been properly implemented by the UK government. While the evidence for failure is compelling, this would be both lengthy and very expensive.
   
   Robert Morfee of solicitors Clarke Willmott in Bristol made a presentation on a particular proposition to EMAG on a no win / no fee basis. CW has extensive experience representing individuals in claims against ELAS. It was agreed to postpone a decision on using CW until after the Penrose report is published. LS to advise.
   
   
3. A revised proposal, to research E U avenues of redress, from the British Institute of International and Comparative Law (BICL) was considered. It was agreed to defer a decision on whether to proceed until after the Penrose report appears. LS will continue with his own research. The committee expressed its thanks to LS for his productive work on EMAG and policyholders' behalf.
   
   
4. SS commented on the letter from the Parliamentary Ombudsman to him ("Mr P", the representative claimant) received January 16th, in response to his face-to-face evidence to the PO of December 4th. His view is that her reply was unsatisfactory, not addressing his complaints properly. The committee expressed its appreciation to SS for his willingness to formally share his PO case experience details with EMAG.
   
   
5. Updated advice from EMAG's solicitor on the prospects for Judicial Review to quash the PO's report, was considered. After lengthy deliberations it was agreed unanimously to proceed with the application for JR and to lodge a revised and simplified claim. It was agreed to set aside a cash reserve to meet the costs of proceeding. JL praised the excellent work from solicitor Stephen Grosz.
   
   
6. CS reported on Burgess Hodgson's work on quantifying detailed losses suffered by ELAS WP members not attributable to stock markets. Progress has been made and relevant material should be available by the time of publication of the Penrose report.
   
   
7. AH presented the paper that he has written and EMAG has submitted to the Treasury Select Committee, as a contribution to its investigation into "Restoring confidence in long-term savings". His report contains much information on the ELAS debacle, notably on how badly it has been handled since 2001 by both the FSA and FOS, and it concludes with several key recommendations for changes in their structure and role. EMAG anticipates publishing this paper.
   
   
8. The question of possible fraudulent misrepresentation by ELAS prior to closure - which has been widely alleged - was discussed. EMAG's constitution determines that the committee cannot currently participate in legal action against the with profits fund.
   
   
9. AOB: PB noted that ELAS had held a press conference that morning, and had announced that the Society will probably not initiate any legal action against the government for compensation.

No date was set for the next meeting.

Chris Carnaghan and Paul Braithwaite
28th January, 2004