The Australian Prudential Regulation Authority (APRA) today announced that it has accepted an Enforceable Undertaking under section 126 of the Insurance Act 1973 (the Act) from Mr Richard Mayo, who was an executive of Zurich Australian Insurance Limited (ZAIL) and its actuary approved under s 40 of the Act for the period from June 2003 until August 2004.

The terms of the Undertaking require Mr Mayo not to work as a senior manager or director of a general insurer for a period of five years, and not to be an approved actuary for a period of ten years.

In signing this Undertaking, Mr Mayo did not admit to any wrongdoing.

The Undertaking was accepted following an ongoing investigation by an APRA-appointed Inspector into certain transactions entered into in 2000 by ZAIL, a general insurer authorised under the Act.

APRA Deputy Chairman, Mr Ross Jones, said that Enforceable Undertakings were viewed by the regulator as an effective alternative to other enforcement actions in some circumstances.

“They provide a useful discipline on the parties and can, if necessary, be enforced by application to the Federal Court,” he said.

APRA’s Inspector is in the course of finalising a report into certain activities of ZAIL. Upon receipt of the report APRA will consider appropriate follow-up action in relation to other parties.

The Australian Prudential Regulation Authority (APRA) is the prudential regulator of the financial services industry. It oversees banks, credit unions, building societies, general insurance and reinsurance companies, life insurance, friendly societies, and most members of the superannuation industry.APRA is funded largely by the industries that it supervises. It was established on 1 July 1998.APRA currently supervises institutions holding approximately $1.8 trillion in assets for 20 million Australian depositors, policyholders and superannuation fund members.