The Australian Prudential Regulation Authority (APRA) today announced the disqualification of Mr Geoffrey Cohen from being or acting as a director or senior manager of a general insurer under the Insurance Act 1973.

Mr Cohen was a non-executive director of HIH Insurance Limited (HIH) and Chairman of the HIH Board of Directors from 1992 to 2001. He was also chairman of Human Resources, Audit, Investment and other due diligence committees during that time.

APRA found that, as Chairman, Mr Cohen failed on a number of occasions to ensure that all relevant matters and materials were properly brought before the HIH Board, and that the audit committee was independent. APRA also found that Mr Cohen failed to address and disclose conflicts of interest arising from his consultancy arrangement with audit firm Andersens and his role on the Audit Committee.

APRA’s Deputy Chairman, Mr Ross Jones, said that “APRA expects directors of general insurers to ensure that a high standard of corporate governance is maintained, boards are properly informed, and conflicts of interest are appropriately managed.”


Background

Mr Cohen failed to ensure that the Board gave adequate time and consideration to, and was fully informed on, a number of aspects of proposals before the HIH Board with respect to the Allianz joint venture, Pacific Eagles transaction and an investment of $2m in Business Thinking Systems. He failed to ensure that the Board was informed that Mr Adler and Mr Williams had interests in these proposals. He also did not disclose the conflicts of interest which arose in relation to the Business Thinking Systems investment which he also knew or should have known was an investment which would breach HIH’s internal investment guidelines. 
 

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.