ROANOKE TIMES
Copyright (c) 1996, Roanoke Times
DATE: Tuesday, August 20, 1996 TAG: 9608200055
SECTION: BUSINESS PAGE: B-5 EDITION: METRO
DATELINE: RICHMOND
SOURCE: Associated Press
New Orleans businessman David Tufts faces a dilemma shared by nearly 3,000 Americans who invested in Lloyd's of London: whether to accept or reject a $4.7 billion settlement from the British insurer.
Choked with emotion, Tufts spoke Monday of how he lacks critical information to judge the settlement and its consequences for his family's financial future.
``This is the most important financial decision I'll ever make,'' Tufts testified at a federal court hearing.
Drawn by client dilemmas like Tufts', several dozen prominent securities attorneys piled into U.S. District Court here as a hearing began on an investors' lawsuit aimed at blocking Lloyd's ``reconstruction and renewal'' plan. The hearing was expected to continue through today.
A lawsuit backed by some 450 U.S. investors of Lloyd's asks U.S. District Judge Robert Payne to block the plan until more detailed financial information is released. Time is critical: Investors must vote on the proposal by Aug. 28. Virginia investors have lost an estimated $2.7million on Lloyd's investments, the State Corporation Commission estimated.
Lloyd's is taking the lawsuit extremely seriously. Ronald Sandler, Lloyd's chief executive officer, testified for two hours Monday.
``This bylaw was subject to considerable scrutiny,'' Sandler said.
Lloyd's spent $150 million in professional fees calculating the size of the settlement, including audits of 800 insurance syndicates and interviews with hundreds of people, he testified.
Sandler also said British regulators approved the plan and investors had the opportunity to object as it was developed over the past three years.
LENGTH: Short : 40 linesby CNB