The Australian Prudential Regulation Authority’s (APRA) investigation into the reinsurance implications of the 2001 HIH collapse has claimed another scalp with the disqualification of Paul Williams, the former Deputy MD of New Cap Reinsurance Australia.

The regulator has found Mr Williams failed to disclose the true nature of a reinsurance arrangement that boosted New Cap Re’s 1998 profit by $US5.7 million ($6.98 million).

APRA Head of Public Affairs Stuart Snell says investigations are continuing. “We’ve disqualified around 28 people in relation to the transactions unearthed by the HIH Royal Commission and we have more actions against individuals.”

He told Sunrise Exchange News APRA is “mopping up” matters relating to people associated with improper practices.

“We’ve completed our company investigations and now we are proceeding against individuals.”

APRA concluded its two-year investigation into General Re in June. The investigation found the reinsurer entered into three improper reinsurance transactions with Zurich Australia, FAI and New Cap Re.

New Cap Re imploded in mid-1999, going into administration with capital deficiencies in excess of $1 billion. Around the same time GIO Australia’s reinsurance arm went into run-off with estimated losses of $743 million and Reinsurance Australia Corporation accrued substantial liabilities.

The reinsurance crisis was a contributing factor, along with the HIH collapse, in the establishment of the General Insurance Reform Act 2001.

APRA has barred Mr Williams indefinitely from acting as a director or senior manager of a general insurer or an authorised non-operating holding company, or a senior manager or agent in Australia of a foreign general insurer. He has the right to appeal against the ruling.