AN INDEPENDENT report into problems at insurance giant RSA has concluded that financial inconsistencies led to a £200m hole in its finances, but were isolated to a few executives at the top of its Irish arm.
The report highlighted “inappropriate collaboration” between three senior managers in the Irish business, which led to large claims being entered into RSA’s system late, in a bid to manipulate profits.
RSA has seen its share price tumble after problems in the Irish business emerged last year. In mid-December ratings agency Fitch put the business on negative watch and investors urged the insurer to sell itself off.
Company bosses were relieved with the findings, undertaken by PwC, and said it was time to draw a line under the issue which prompted the dismissal of finance chief Rory O’Connor and claims director Peter Burke in Ireland on Wednesday.
Executive chairman Martin Scicluna said RSA would learn lessons from the process, but chief financial officer Richard Houghton warned that it was difficult to account for the type of managerial overrides which occurred in Ireland all of the time.
“We still have a lot of work to do but we’re going to work to make sure that doesn’t happen again,” Scicluna said. “We investigated 96 per cent of the rest of the group and we have no similar issue anywhere else,” he added.
Houghton confirmed that the company’s whistle-blowing policy is being beefed up and that tighter controls would be implemented as recommended in the report.