The prudential watchdog has barred another former General Re employee, London-based Milan Vukelic, for his alleged involvement in illegal reinsurance contracts with the now defunct FAI Insurance.

He is not allowed to be 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.

The Australian Prudential Regulation Authority (APRA) alleges that Mr Vukelic – who is CEO of the London-based Faraday Group – was involved in a reinsurance transaction between the group’s Australian subsidiary, General & Cologne Reinsurance Australia (GCRA), and FAI.

It says the contracts improperly boosted FAI’s 1997/98 profit, and the risks for GCRA were removed through side letters.

APRA has advised the Financial Services Authority in the UK of its decision.