andMr. McQuillan asked the Minister for Industry and Commerce the last date on which completed audited accounts relating to the activities of the Equitable Insurance Company Limited were submitted to his Department; and whether his Department were satisfied that these accounts were accurate and in accordance with the provisions of section 101 (a) of the Insurance Act, 1936.
Ceisteanna—Questions. Oral Answers. - Equitable Insurance Company Limited.
28.
Audited returns in respect of the year ended 30th June, 1961, were received from the Equitable Insurance Company on 30th September, 1961. They were complete and complied in every respect with the Insurance Acts. An examination of these returns did not show the company to be insolvent.
Audited returns in respect of the year ended 30th June, 1962, were received from the company on 3rd April, 1963. These returns were incomplete in certain respects and did not comply fully with the Insurance Acts. An examination of these returns showed the company to be insolvent.
As to the accuracy of these accounts, my Department relied in each case on the auditors' certificate.
Is the Minister satisfied now that the certificate signed by the directors in accordance with the provisions of the Insurance Act, 1936, was accurate for the year ended June, 1961?
I presume the directors of this company, as in the case of every other company, relied on the certificate of the auditors. In so far as the certificate of the auditors might have been inaccurate as far as the accounts in the last year were concerned, to that extent, the directors' certificate was not correct.
It was not correct?
I said that in so far as the auditors' own certificate was not correct, on which the directors relied, to that extent the directors' certificate was not correct.
May we take it that if the loss incurred by the Equitable Insurance Company goes back prior to 1962, it might go back for a number of years? Would the Minister be able to comment on that? Is it possible that the losses incurred in this company could have gone back for the past two or three years?
Insurance companies incur losses from one year to another in different branches of insurance. The losses they incur in one branch might be made up in another. It is not possible at this stage to find out to what extent losses may have been incurred in one branch or another and to what extent they affected the solvency of the company.
In view of the fact that the company did eventually become insolvent, does the Department take any steps to go back over the audited accounts of previous years in order to find out whether the assets and liabilities, as stated in these accounts are, in fact, an accurate representation of the position at that time?
My Department and I as Minister have certain functions in relation to insurance companies, the main function being the issue of a licence to insurance companies to practise, as long as they make certain returns and when and as soon as these returns show a state of insolvency, it is my duty then to do certain things, including the appointment of an auditor. Immediately on the returns indicating in this case that there was insolvency, I applied to the court for the appointment of an auditor and from there on, it is a matter for the auditor to make whatever examinations he deems fit under the direction of the court. That is being done at the present time.
If we accept the certificate issued by the directors for 1961, then it is apparent that between 1961 and the next audit, the sum of over £107,000 is missing. If that certificate is correct in 1961, that loss of £107,000 has arisen within the past 12 to 18 months. In those circumstances, would the Minister now have an inquiry carried out into this company on the same lines as the inquiry into Irish Estates?
I think I am having the most effective form of inquiry possible carried out, inasmuch as an auditor has been appointed by the High Court and the affairs of the company are now being administered and wound up under the direction of the High Court. I do not think there could be a more searching inquisition than that.
Will the Minister take any steps to recoup the losses incurred by persons having insurance with this company?
That is a difficult problem and, as I mentioned to the House some time ago, I have that matter under consideration at the moment. It is not easy to ascertain what the losses are in insurance business, what the extent of them is, but I am having inquiries made and the whole matter is still under consideration.
Representations have been made to almost every Deputy by persons who have suffered financial loss. I have heard of several cases where there was very heavy financial loss as a result of the insolvency of this company and surely there is an obligation on the Minister to take action in this matter?
Question No. 29.