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THE FINANCIAL SUPERVISION COMMISSION EXPELLED RSM BULGARIA LTD FROM THE LIST OF THE INDEPENDENT EXTERNAL REVIEWERS OF INSURERS AND PENSION FUNDS

With a decision dated 02.09.2016 FSC expelled RSM Bulgaria Ltd. from the list of the independent external reviewers of insurers and pension funds.

An investigation carried out by the Steering Committee and the FSC has unveiled that the documents provided by the company, contained substantial false information. It was found that there is misleading information, provided in the process of selection and appointment of independent external reviewers to carry out the pension funds’ assets reviews and insurance balance sheets reviews. The candidates were required to provide international teams with high qualification and expertise to carry out the reviews. A number of international partners that were reported by RSM Bulgaria Ltd to be part of the review teams did not have any knowledge of their participation in such reviews, CV’s of such international partners were false and they have reported that the signatures on their CV’s submitted to the FSC were not laid by them. Some of them even declared that the submitted CV’s are false. 

The cited documents were the grounds for the selection of RSM Bulgaria Ltd. by the Steering Committee and the FSC, proving the necessary qualification, experience and availability of resources.  

In addition, it was found, that RSM Bulgaria Ltd. continued to report in the regular submission of documents after the start of the reviews, that such persons carried out work in the reviews, which in the investigation was reported by the same persons to be untrue. The misinformation uncovered involves the misuse of names of international responsible managers, actuaries and other team members in the reviews of different insurance undertakings and pension funds.

The investigation was expanded to cover other independent external reviewers, and for no other reviewer there is any evidence for such misinformation.

Based on the evidence that the documents provided by RSM Bulgaria Ltd. contained serious misinformation, the Steering Committee and the FSC have taken a decision to expel RSM Bulgaria Ltd. from the list of independent external reviewers who can perform reviews in the insurance and the pension funds sector and has cancelled all individual decisions for appointment of RSM Bulgaria Ltd. as an independent external reviewer. The insurers and the pension insurance companies are required to terminate immediately the contracts with RSM Bulgaria Ltd. and to select a new independent external reviewer from the approved list  within a time frame which is specified in a new procedure.

The FSC will inform the respective competent authorities for the results of this investigation to request appropriate legal actions against the responsible persons.

The chair of FSC Karina Karaivanova has stated:
“The conducted investigation and the decisions taken show that the Financial Supervision Commission works in a transparent way and in dialogue with all its partners. As the whole purpose of the exercise mandated by the Parliament is to enhance the credibility of insurance sector and the pension funds sector we see no other way than remove RSM Bulgaria Ltd. from the reviews and we will launch offers to find credible international reviewers to replace RSM Bulgaria Ltd. Regardless of all, we are determined to finalize the reviews before the end of this year.”