Insurers concerned about brand damage from case
FINANCIAL Services Board (FSB) pensions registrar Rosemary Hunter’s case against her employer has sparked unease in the financial services industry, with insurer Liberty and an industry association expressing concern about possible reputational damage. In an answering affidavit board, CEO Dube Tshidi has provided evidence that the case had the potential to cause reputational damage beyond the FSB.
FINANCIAL Services Board (FSB) pensions registrar Rosemary Hunter’s case against her employer has sparked unease in the financial services industry, with insurer Liberty and an industry association expressing concerns about possible reputational damage.
In an answering affidavit filed two weeks ago, FSB CEO Dube Tshidi included letters from Liberty CEO Thabo Dloti and the Association for Savings and Investment SA (Asisa) as proof that the case had the potential to cause reputational damage beyond the FSB.
In January, Ms Hunter took the FSB, Mr Sithole, Mr Tshidi, Finance Minister Pravin Gordhan and her predecessor, Jurgen Boyd, to court, claiming there had been irregularities in the way the FSB handled the cancellation of thousands of dormant and orphan funds. This had resulted in material prejudice to fund members.
Liberty administered 80% of the 6,757 dormant funds cancelled, according to Mr Tshidi’s affidavit.
In his letter addressed to FSB chairman Abel Sithole, Mr Dloti said Ms Hunter had made “serious allegations” against Liberty Corporate and its employee-benefits business, based on confidential information given to her.
“It is of significant concern to us that she has taken the view that these allegations and disclosures have been made in the public interest,” Mr Dloti wrote. “We have an interest in how this matter is managed by the FSB because it is hav- ing a direct reputational and commercial impact on Liberty Corporate and other affiliated companies within the Liberty Group.”
Mr Dloti said the insurer believed Ms Hunter’s disclosures were not appropriate or in the public interest.
Nigel Carman, Ms Hunter’s attorney, confirmed that they had seen Mr Tshidi’s affidavit.
On Friday, Mr Dloti did not elaborate on the reputational or commercial effect the case has had on his company.
“Liberty has been mentioned in media coverage in relation to the said application,” he said.
“However, it is not a party to the application and … it is inappropriate for Liberty to comment on any of the factual or legal allegations made by any of the parties … ”
He said Liberty remained on good terms with the FSB.
“We remain confident that our customers view us as a trusted leader in insurance and investment in our chosen markets.”
Asisa CEO Leon Campher and Peter Dempsey, his deputy, had also written to Mr Sithole and other board members.
Asisa was concerned “that the FSB is currently dealing with some matters which are in the public domain and subject to the judicial process, and which cast aspersions on the integrity and reputation of the FSB”.
Mr Dempsey said the Asisa letter that Mr Tshidi cited, “was written by Asisa on behalf of all” the organisation’s members.
“It does not comment on the merits of the case currently before the courts or express concerns about the case itself, but rather calls for a speedy resolution of this matter since the reputational damage being caused to the FSB as the regulator is not good for the industry as a whole.”
Mr Gordhan filed his responding affidavit last month, stating that he was not asked to act on Ms Hunter’s complaints before she went to court.
Mr Tshidi said in the affidavit Ms Hunter’s actions had caused “serious disquiet” in the financial services industry.
“Concerns have been expressed about the preservation of confidentiality with regard to information that regulated entities are consistently required to provide to the regulator,” he said.