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APRA makes further disqualifications in relation to HIH

9 Feb 2005
05.08

The Australian Prudential Regulation Authority (APRA) has announced the disqualification of Mr John Tuckfield from being or acting as a Director or senior manager of a general insurer or authorised non-operating holding company, or a senior manager or agent of a foreign general insurer in Australia.
 
APRA found that Mr Tuckfield, in his role as a reinsurance broker employed at the time by Guy Carpenter & Company Pty Ltd, participated in the negotiation of, and backdated documentation relating to, a transaction in June 1998 between FAI General Insurance Ltd and National Indemnity Company, which he was aware:
  • had involved no genuine material risk transfer;
  • was intended to improperly boost FAI’s 30 June 1998 solvency position;
  • would be misrepresented to other parties, including FAI’s auditors; and
  • would ultimately prove to be financially detrimental to FAI.
In APRA’s judgement, Mr Tuckfield’s conduct in relation to the FAI-National Indemnity transaction demonstrated a failure to act with good faith, honesty and openness.
 
APRA’s Deputy Chairman, Mr Ross Jones, said the assessment of a number of individuals involved in the collapse of HIH is continuing.
 
“APRA expects to have comprehensively assessed some 40 individuals for possible disqualification by the time this exercise is complete,” he said.
 
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 $2.0 trillion in assets for 20 million Australian depositors, policyholders and superannuation fund members.