Contingencies Online - November/December 2011

2. During the investigation, but before the investigator has filed a final report;

3. After the investigator’s final report, but before the ABCD has decided whether to proceed to a hearing;

4. After the ABCD votes to conduct a hearing, but before the hearing;

5. After the subject actuary’s hearing, but before discipline is imposed by his or her membership organization(s);

6. After discipline is imposed by the subject actuary’s membership organization(s).

As part of their presentations, members of the ABCD outlined the details of a fictional discipline case. Session attendees were asked to form groups and discuss when transparency appropriately might be introduced in the discipline process for that imaginary case. Each group reported its recommendation and the reasons for it.

Given the perceived support for transparency, it was surprising that almost every group at both meetings reaffirmed current confidentiality practices. That is, the subject actuary should remain unidentified until the discipline process concluded with some form of public discipline. The most common rationale for this position was that earlier identification of the subject actuary could affect his or her reputation adversely, potentially hampering his or her livelihood.

moving the Needle

One of these fictional cases provided a surprising result. The hypothetical situation involved a high-profile arrest in which national media identified the suspect as an actuary. This imaginary scenario did not involve actuarial services, but the circumstances of the arrest clearly indicated that the actuary violated the Code of Professional Conduct. Precept 1 of the Code of Professional Conduct and Annotation 1-4 require an actuary to act with honesty and integrity and prohibit an actuary from actions that adversely affect the reputation of the actuarial profession.

Session attendees at the Enrolled Actuaries Meeting agreed that the actuary had violated the Code of Professional Conduct, but also agreed that transparency should not be introduced earlier in the discipline process—even in cases in which the actuary was named in national media. While many attendees suggested that the discipline process be shortened in cases of obvious violations of the Code of Professional Conduct, none would identify which particular step to eliminate.

If CUSP’s proposed revision to the discipline process is adopted, then future discipline panels will need rules of procedure to establish a new administrative due process, confidentiality requirements, and the subject actuary’s rights and responsibilities. These new rules would be analogous to the ABCD’s current rules of procedure but would reflect the amended discipline process.

These rules also could move the information needle along the confidentiality/transparency spectrum from its current position. I urge you to contact the presidents and presidents-elect of your respective actuarial membership organizations and give them your opinion as to where that needle should rest.

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ROBERT J. RIETZ, recently retired from Deloitte Consulting LLP, is vice chairperson of the Actuarial Board for Counseling and Discipline.

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