Former HIH Insurance director Rodney Adler is being punished by prison authorities for allegedly trying to run businesses from his cell after only eight weeks in the minimum security Kirkconnell Correctional Centre.

The NSW Corrective Services Department found he’s been using time spent with his children to help them with their homework as a disguise for conducting business activities. The department’s week-long investigation found his letters and telephone calls indicated he was conducting a business, despite being on a 20-year ban from acting as a company director or manager.

The authorities moved quickly to punish Mr Adler for his rule breaking. Yesterday he was moved from Kirkconnell to the higher-security Bathurst jail. He could also face charges of breaching the Corporations Act, lose jail privileges like visitation rights, and even face more jail time.

NSW Justice Minister John Hatzistergos says prison officials first noticed Mr Adler’s dealings, and reported them to the relevant authorities.

“It can mean a loss of privileges, including confinement to cells,” he said of Mr Adler’s rule breaking. “Bathurst doesn’t have the same ambience as Kirkconnell. I don’t think Bathurst would be the first choice of most prisoners.”

In letters published by Fairfax newspapers, Mr Adler wrote to three undisclosed colleagues, demanding certain information be sent to him in jail.

“In regard to work, it appears… that you do not, as yet, prepare weekly reports for B and therefore do not bring them to be so we can discuss the events of the previous week,” he wrote. “Your reason, according to you, is you are too busy. This is not acceptable. If you were working for someone else, or a company with some structure, then you would have reporting responsibilities which could not be postponed.”

Federal Justice Minister Chris Ellison has also ordered an investigation into Mr Adler’s activities, which could result in the revocation of his parole.

The results of the prison investigation will be forwarded to the Australian Securities and Investments Commission and the Commonwealth Director of Public Prosecutions for further consideration.