Equitable Life is suing its former auditors Ernst & Young for up to £2.6bn (E2.9bn) over its role in the guaranteed annuity crisis that pushed it to the brink of collapse. In a statement to policyholders, Equitable Life says its solicitors Herbert Smith had written to former directors, auditors and advisers asking for explanations for their actions.
Equitable has launched legal proceedings against Ernst & Young as it failed to provide a ‘substantive reply.’ The writ suggests the auditors should have realised that the society had a particularly high risk exposure and that its statutory accounts between 1997 and 1999 should have provided for guaranteed annuity liabilities.

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