L&G hires top City lawyers to review compliance claims

LEGAL & General hired a top City law firm to conduct an investigation into its investment arm after a whistleblower reported compliance failures earlier this year.

The FTSE 100 insurer hired Latham & Watkins to investigate the risk management processes in its funds unit after an employee complained that it was not following the rules, sources close to the inquiry said.

The investigation, which recently closed, involved comparing the firm’s practices with rivals to see if the insurer fell short. It concluded that L&G’S processes were “not perfect, but pretty good”, one person said.

However, the insurer is still conducting an internal investigation into a mistaken trade, also flagged by the anonymous whistleblower, after finding that one client lost out to the tune of $130,000 (£99,000). It found no errors involving a third client, pension fund giant USS.

Legal & General declined to comment, while Latham & Watkins could not be reached at the time of writing.