Financial News

  • 10 January 2014, 4:22

Insurer RSA Fires Two Over £200m Cash Scandal

RSA Insurance has revealed two top managers in its Irish division have been fired over a £200m hole in its finances the company has had to plug.

The company, which owns the More Than brand, said an independent investigation by auditors PricewaterhouseCoopers found "inappropriate collaboration" among the division's managers.

The scandal contributed to three profit warnings in six weeks in the run-up to Christmas and prompted the resignation of group chief executive Simon Lee.

The report, RSA said, confirmed the financial issues were isolated to Ireland and claimed that executives sought to deliberately sidestep group governance controls.

The scandal, RSA had previously stated, was related to a surge in bodily injury claims in the motor insurance market.

The company told the market on Thursday morning that its Irish finance boss Rory O'Connor and the division's claims director Peter Burke were sacked on Wednesday following a disciplinary and appeals process.

Irish chief executive Philip Smith had already quit after being suspended.

RSA executive chairman Martin Scicluna said today: "The issues which emerged in our Irish business in 2013 were completely unacceptable and I have made it my personal priority to ensure that this never happens again.

"We acknowledge that there are lessons to be learnt and we are tightening elements of our control and financial framework in response to these events."

RSA also revealed on Thursday yet more woes for its finances as it said the severe flooding in the UK and Ireland over Christmas, combined with the ice storms in Toronto, would further hit its 2013 figures.

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