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  #801  
Old 11-10-2017, 12:21 PM
jim palermo jim palermo is online now
 
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Inside baseball at its finest!
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  #802  
Old 11-14-2017, 01:58 PM
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Inside baseball at its finest!
What does this mean?
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  #803  
Old 11-14-2017, 05:13 PM
jim palermo jim palermo is online now
 
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It's a hat-tip to jas66Kent, who's keenly following this thread.
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  #804  
Old 12-16-2017, 04:51 PM
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I wonder what is going on....why is there radio silence from both Mr Sharpe and the Academy ?

The fascinating thing about this thread has been the many important themes, played out in slow motion. How will the stories end ? Anyway, to recap themes
- At first, before discussion on AO, the story was a simple ABCD complaint concerning the duties of an actuary in his selection of assumptions or in communication of valuation calculations.
- When this thread started, the story became about ABCD and Academy duties of confidentiality.
- And also about ABCD and Academy slow speeds of action.
- And it might also be about the wording of by-laws, and economy or elegance vs clarity.

Here is the time line, with the start of this thread well down in the list
- In March 2014, Tia Goss Sawhney, MAAA, FSA, filed a complaint about Timothy Sharpe with ABCD, concerning his valuations of local Illinois government pension plans.
- In August 2014, she published an article, outlining the basis for her complaint, meanwhile also making the complaint public (not sure if this was the first such notice).
- In November 2015, ABCD conducted a hearing on the complaint. I believe that Sharpe attended, possibly with his attorney..
- On Jan 29, 2016, ABCD recommended to the Academy (the only actuarial organization to which Sharpe belongs) that Sharpe be expelled.
- Also in early 2016, someone from the Academy or from ABCD leaked the recommendation to Sawhney, who promptly leaked it to Wirepoints, who published this news on Feb 9, 2016. She had previously made clear that she would leak any such news that she received.
- In February 2017, Sharpe sued the Academy for the confidentiality breach, and for destroying his business by the leak and the slow action on the complaint. (Note that ABCD is a part of the Academy.)
- Also in February 2017, Sharpe joined the AO and started this thread.
- The Academy held a hearing about Sharpe on March 31, 2017. Sharpe attended but his attorney was not available on the day selected by the Academy. (I am assuming the hearing was held, although this thread only has information about its scheduling.) The Academy has not announced any findings or discipline.
- Court filings were made by Sharpe and the Academy, February 2017 through May 2017.
- And for the last 7 months....nothing.

Much of this has little to do with Ms Sawhney's complaint, made nearly 4 years ago. I wonder whether there was reluctance at the Academy to take official positions regarding actuarial work for state and local pension plans, viewing the whole area as a series of landmines. Maybe that translated into very slow ABCD action on this case, frustrating the eventual leaker, who believed he saw opportunity or anyway ambiguity in the wording of by-laws.

The confidentiality issue is whether ABCD/Academy can reveal the ABCD recommendation of discipline to the complainant (in this case, Ms Sawhney) when the relevant actuarial membership bodies (just the Academy, in Sharpe's case) have not announced disciplinary action. There is no question that such disclosure to anyone else, is not allowed, but rules regarding disclosure to the complainant are a more tangled web. The ABCD and Academy by-laws must be read very closely to reach a conclusion about this issue, and the respective legal teams went into great detail to reach opposing conclusions. (A similar exercise is deriving a plane geometry proof from a limited set of postulates.) Sharpe also offers to provide evidence of drafting intent, which I guess would be testimony or emails, obtained via discovery.

Most every commenter on this site is surprised that the Academy would take the position that ABCD/Academy can breach confidentiality as has been done here, given all the Power Point presentations made to members over the past several years that emphasized the confidentiality of the entire discipline process (i.e., from ABCD through member organization). My personal view, which I believe is Sharpe's position, is that the special provision regarding the complainant was created so that, following either an ABCD recommendation of no discipline, or a member organization finding of no discipline, the complainant could be notified that the matter was resolved. I think the Academy was forced to take a silly legal position in order to support somebody's bad actions here.

I imagine that settlement negotiations are going on, as are discussions among Academy officers and lawyers. No one involved can comment, of course. Some possible topics...
- Will the Academy expel Sharpe, even after all this time ?
- Or, will the Academy give Sharpe a cash settlement ? an apology ? (Picture how ironic Ms Sawhney would view this sort of result !)
- Will the Academy clarify its actual position regarding disclosures to complainants ?
- Will the Academy sue the leaker, whoever that was ? Or bring an ABCD complaint ? (I see no justified cause of action against Ms Sawhney.)
- Will ABCD and the Academy act more quickly in the future ? I have no idea why this case moved so slowly, twice. (In ordinary cases, the Academy might stay silent to protect the actuary, if it determined that no discipline was warranted. The cat is out of the bag here and the Academy has a duty to announce whatever finding it makes. So I conclude that the Academy has not yet finished its work. I may be wrong on this point.)

It would be a shame if the resolution is (or was !) a settlement with non-disclosure agreements. There really is too much here for the Academy to make no communication to members. We'll see if the Academy officers agree.
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  #805  
Old 12-17-2017, 06:27 PM
pragmatist pragmatist is online now
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Originally Posted by msydlaske View Post
It would be a shame if the resolution is (or was !) a settlement with non-disclosure agreements. There really is too much here for the Academy to make no communication to members. We'll see if the Academy officers agree.
Any agreement between the parties to that lawsuit would not be binding on the rest of the members. Even if the parties reach a non-disclosure agreement, everybody else could demand the Academy to shape up about its by-laws and processes.
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  #806  
Old 01-05-2018, 05:21 PM
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Sharpe got a public reprimand today: http://www.actuary.org/content/ameri...line-notice-19

Quote:
WASHINGTON—The American Academy of Actuaries announced that the following discipline action became effective on Jan. 5, 2018.





Notice of Public Discipline
(Effective Date Jan. 5, 2018)

The American Academy of Actuaries (“Academy”), acting in accordance with its Bylaws, has reviewed the findings from the Actuarial Board for Counseling and Discipline (“ABCD”) and decisions by both a Hearing Panel and an Appeal Panel of the Joint Discipline Council (“JDC”) regarding Timothy W. Sharpe, MAAA, EA. The Academy hereby publicly reprimands Mr. Sharpe for materially failing to comply with Precepts 1, 2, 3, and 4 of the Code of Professional Conduct.

The ABCD and JDC concluded that Mr. Sharpe materially violated Precept 1 of the Code, which requires actuaries to “act . . . with . . . competence.” Annotation 1-1 amplifies that provision by stating that actuaries must “perform Actuarial Services with skill and care.” Specifically, the ABCD and JDC found that in performing a 2011 Other Postemployment Benefits Other Than Pensions (“OPEB”) valuation for the Village of Melrose Park, Illinois

(the “Project”) Mr. Sharpe failed to confirm whether vision and dental benefits were included in the premium rates that he used in his work and whether surviving spouse benefits were also covered by the plan.

The ABCD and JDC also determined that Mr. Sharpe’s violation of Precept 2 of the Code (discussed below) constitutes a violation of Precept 1.

The ABCD and JDC concluded that Mr. Sharpe materially violated Precept 2 of the Code, which requires that actuaries “perform Actuarial Services only when . . . qualified to do so on the basis of basic and continuing education and experience, and only when . . . satisf[ying] applicable qualification standards.” The Qualification Standards impose the obligation on the actuary to be able to document his compliance with the continuing education requirement. The ABCD and JDC determined Mr. Sharpe did not meet the qualification standards required to perform the Project because he failed to meet the continuing education requirement in the health practice area. The ABCD and JDC also concluded that Mr. Sharpe’s violation of Precept 1 also supported its determination that he violated Precept 2.

The ABCD and JDC concluded that Mr. Sharpe materially violated Precept 3 of the Code, which requires that the actuary performing actuarial services “satisfy the applicable standards of practice.” The ABCD and JDC found that Mr. Sharpe’s work on the Project violated several Actuarial Standards of Practice (“ASOPs”). Mr. Sharpe’s work failed to meet the requirements of ASOP No. 6, Measuring Retiree Group Benefit Obligations, in a number of ways, including by failing to (i) document the methods and procedures he used to develop the initial per capita health care rates and any significant actuarial judgments applied during the modeling process; (ii) adjust pre-65 premium rates that contained retiree experience, and (iii) document how he satisfied ASOP No. 6. In addition, Mr. Sharpe used only one age band below 65 and only one age band above age 64. The ABCD and JDC also found that Mr. Sharpe failed to describe the assumptions and methods he used in the measurement with sufficient clarity that another actuary qualified in this practice area could make an objective appraisal of the reasonableness of his work.

The ABCD and JDC also concluded that Mr. Sharpe failed to comply with several sections of ASOP No. 23, Data Quality. In particular, the ABCD and JDC found that he failed to disclose (i) reliance upon a third party for providing premium rates below age 65 and
above age 64; (ii) whether he reviewed the premium rates for reasonableness; and (iii) the process used to evaluate the data and any material defects in the data and any adjustments made to the data.

The ABCD and JDC further concluded that Mr. Sharpe violated ASOP No. 41, Actuarial Communications, in three ways: (1) by failing to disclose the data, assumptions, and methods used in the Project with sufficient clarity that another actuary qualified in this practice area could make an objective appraisal of the reasonableness of his work; (2) by failing to disclose reliance on premium data obtained from a third party; and (3) by failing to comply with ASOPs No. 6 and No. 23 as described above.

Finally, the ABCD and JDC concluded that Mr. Sharpe materially violated Precept 4 of the Code, which requires that an “Actuarial Communication” issued by an actuary “satisfies the applicable standards of practice.” Precept 4 requires that an Actuarial Communication – defined as “a written, electronic, or oral communication issued by an Actuary with respect to Actuarial Services”—comply with the ASOPs. The ABCD and JDC determined that Mr. Sharpe’s failure to meet the disclosure requirements of ASOP Nos. 6, 23, and 41, as described above, violated Precept 4.

Based upon the foregoing, the Academy publicly reprimands Mr. Sharpe.

For more information, please contact David Mendes, assistant director of communications for public affairs at the American Academy of Actuaries, at 202.785.7872. For more information on the American Academy of Actuaries, please visit www.actuary.org.
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  #807  
Old 01-05-2018, 05:31 PM
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Am I correct in assuming that the public reprimand means that the Academy has decided that they are NOT going to expel him as recommended by the ABCD?
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  #808  
Old 01-05-2018, 06:12 PM
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Originally Posted by twig93 View Post
Am I correct in assuming that the public reprimand means that the Academy has decided that they are NOT going to expel him as recommended by the ABCD?
That's how I would interpret it.

If Mr. Sharpe thinks the reasons of the public reprimand are inaccurate, I would strongly encourage him to disprove them. Except for any confidentiality constraints, it would be interesting to see whether another actuary qualified in this practice area could make an objective appraisal of the reasonableness of his work or whether this is rather an inappropriate "retribution" for the lawsuit.
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  #809  
Old 01-05-2018, 10:13 PM
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Given how this started, this is something of a hot mess.

I look forward to an update from Mr. Sharpe, if he is permitted and willing to share.
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  #810  
Old 01-05-2018, 11:08 PM
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Yeah. This is going to turn into an even bigger mess now.
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