Notice of Disciplinary Determination
On March 25, 2010, the Society of Actuaries convened a Discipline Committee to review a matter referred by the Actuarial Board for Counseling and Discipline ("ABCD"). The matter related to work performed by William Lynn Townsend, FSA, in his role as the appointed actuary for a life insurance company for year ends 2004, 2005, and 2006.
The Discipline Committee determined to publicly reprimand Mr. Townsend for material violations of certain Precepts under the Code of Professional Conduct.
- Precept 1 states, "An Actuary shall act honestly, with integrity and competence, and in a manner to fulfill the profession's responsibility to the public and to uphold the reputation of the actuarial profession."
- Precept 3 states, "An Actuary shall ensure that Actuarial Services performed by or under the direction of the Actuary satisfy applicable standards of practice."
- Precept 4 states, "An Actuary who issues an Actuarial Communication shall take appropriate steps to ensure that the Actuarial Communication is clear and appropriate to the circumstances and its intended audience and satisfies applicable standards of practice."
A violation of Precept 1 related to Mr. Townsend's failure to stay current with the relevant requirements of the insurance department of the state in which the company was domiciled with respect to statements of actuarial opinion for the subject year ends. The violation of Precept 3 related to his failure to comply with the requirements of the U.S. Actuarial Standards of Practice Nos. 22 and 41. Violations of Precepts 1 and 4 related to his issuance of statements of actuarial opinion indicating compliance with the insurance department's asset adequacy analysis requirements, and his failure to incorporate the appropriate analyses in providing those statements of actuarial opinion.
All members of the SOA are reminded that when they are faced with potential issues regarding professional conduct, the ABCD is available for counseling.