Registrar of Companies and Official Receiver Stephen Lowe says his own family and staff lost money in the British American Insurance Co debacle.He says he understands the pain policyholders are feeling, but he has become concerned about misinformation about the BAICO winding up and the level of abuse being levelled at his department and agents KPMG by some of the 5,500 policyholders.“There just are no easy answers in this case,” he said in an interview. “The tragedy of this has not been lost on any of us. But we came in after the fact. After British American became hopelessly insolvent.”However, ultimately, he said it’s important to note: “Bermuda creditors are the only ones who have had any distribution from the company’s operations in the Caribbean and Bermuda, to date.”Mr Lowe said he wanted policyholders to know his department did all it could to get them as much money as possible back on their policies and as quickly as possible, and had it not been for the expertise and efforts of KPMG and Conyers Dill & Pearman, they would have received much less.He said KPMG put in excess of 10,000 hours working on what was a highly complex, multi-jurisdictional case which required tracking down thousands of policyholders amid poor BAICO records, and assigning value to their policies; and negotiating with various overseas parties to secure a more favourable outcome for policyholders plus the proceeds from the sale of the BAICO building.He stressed this was a winding up of a branch of a company not even based in Bermuda, which invested heavily in Florida real estate and got caught in the crash. The policies written in Bermuda were written through a branch of BAICL, which is a Bahamian incorporated company. He also noted policyholders had been told prior to their distributions not to expect more than 50 cents on the dollar.And he said had it not been for certain actions of the Bermuda Government in regulating the Bermuda branch, it would have been much worse for policyholders.Mr Lowe and KPMG provided the following answers to frequently asked questions:Why will I only receive 37.5 percent in total in respect of my claim which was valued under the Scheme?BAICL is insolvent, which means that it does not have sufficient assets to meet creditor claims. Specifically in relation to BAICL Bermuda, the level of the Pledged Assets and Other Assets secured by the PL through the Settlement Agreement (see below), are less than the sum of all Scheme Creditor claims.BAICL Bermuda operated as a branch of BAICL, a company incorporated in the Bahamas. BAICL assets located in Bermuda fell into two categories; those specifically pledged for Bermuda resident creditors and those available for distribution to all creditors of BAICL, whether located in Bermuda or elsewhere.With respect to the first category, as a result of actions taken by regulatory authorities in Bermuda, including the Bermuda Monetary Authority, certain assets of BAICL were specifically pledged for Bermuda resident creditors. The Pledged Assets amounted to $7.8 million at the time the PL was appointed. This amount came under the control of the PL shortly after his appointment, the majority of which was distributed to Scheme Creditors in December 2011.The second category of assets located in Bermuda, which were not specifically ring-fenced for Bermuda resident creditors, included cash, investments, mortgage loans and a 40 percent interest in Bram-ber, the entity which owned the Building from which BAICL Bermuda ran its operations.In order to ensure that the Other Assets, or as much of them as possible, were secured for the benefit of the Bermuda resident creditors, the PL negotiated the Settlement Agreement with the JM of BAICL. The Settlement Agreement, which was approved by the Bermuda Court and the Commonwealth Court of the Bahamas, provided that the JM waive any rights or claims to both the Pledged Assets and the Other Assets, in exchange for a payment of $445k to the BAICL estate in the Bahamas. After payment of the Settlement Amount, the remaining Other Assets were used by the PL to meet the ongoing operating costs and professional fees of BAICL Bermuda.Securing all assets located in Bermuda for the benefit of Bermuda resident creditors allowed the PL to implement the Scheme and make the first distribution to Scheme Creditors in December 2011.After payment of the first distribution, the only asset which had not been realised by the PL was BAICL Bermuda’s 40% interest in Bram-ber. The remaining 60% interest in Bram-ber was owned by the Bermuda Employees of British American Pension Trust (“the Pension Trust”). In January 2013, the directors of Bram-ber concluded a sale of the building, resulting in Bram-ber receiving net proceed (after transfer costs and legal fees) of $1.628m. BAICL Bermuda’s share of the net proceeds was approximately $650k, and this was distributed to BAICL Bermuda following the liquidation of Bram-ber.The second distribution to Scheme Creditors consists primarily of BAICL Bermuda’s interest in Bram-ber. It was expected that the second distribution to Scheme Creditors would be more than 2.5%, however the final sale price of the building was lower than originally forecast, and this has resulted in the second amount available for distribution to Scheme Creditors being lower than originally anticipated.Why has it taken the PL four years to complete these distributions?It is not unusual for an insolvent insurance company to be in liquidation for a number of years before being in a position to pay creditors. This is due to the nature of the business it undertakes and the contingent nature of its liabilities. In the case of BAICL, the liquidation was made more difficult as a result of three principal factors: (a) the records of BAICL and BAICL Bermuda were not in good order and required considerable work to ensure that the PL could identify the creditors and the amounts due to them; (b) the number and many types of policies written by BAICL Bermuda were considerable; and (c) BAICL Bermuda was a branch of BAICL, a Bahamian company, and much of the documentation was not located in Bermuda, and the financial reporting systems were controlled from outside of Bermuda.Added to this, under Bermuda law, the liquidator of a life insurance company is required to seek a solution which will allow for the continuation of the life insurance policies written by the company.The PL, in accordance with his duties as liquidator of BAICL Bermuda, and mindful of the hardships which policyholders would face if all the BAICL Bermuda life policies were terminated, spent a considerable amount of time investigating potential solutions that would allow the life insurance policies to continue. Unfortunately no solution was available which would allow the life insurance policies to continue. In July 2010, the PL had no other option but to pursue a route that would allow Bermuda resident policyholders’ claims to be valued and distributions paid to them.Why are the professional fees on this engagement so high?The liquidation of BAICL Bermuda has been a complex, multi-jurisdictional engagement, which has been made more difficult by the poor state of the Company’s policyholder and financial records and the fact that BAICL Bermuda is a branch of a company incorporated in the Bahamas. The job of managing the BAICL Bermuda operations and the administrative burden of managing, corresponding with, and paying distributions to more than 6,000 policies, over a period of approximately four years, has resulted in significant time and professional costs to the estate.In order to minimise the professional fees charged to the estate, the OR negotiated a discount of approximately 40 percent to KPMG’s standard Court approved rates. Conyers also discounted their fees and agreed not to charge for all their time spent over the course of the liquidation. In addition, to further reduce costs to the estate, BAICL Bermuda employees were used to manage the day-to-day operations of the Company while under the supervision of the Agents.All fees paid to the Agents have been reviewed in detail by the OR, and paid out of the Other Assets (i.e. the assets which were not pledged specifically for the benefit of Bermuda resident creditors).