The MD of Rural and General Insurance Broking has been disqualified under the “fit and proper” provisions of the Insurance Act. Aaron Stephenson has been barred from being or acting as 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.

The Australian Prudential Regulation Authority (APRA) says Mr Stephenson, who has been involved in a number of legal flurries with the regulator, is accountable for several misconduct breaches under the law.

Last year the regulator warned the industry and consumers that the brokerage was closely associated with and acted as an agent for Rural & General International Insurance, an unauthorised foreign insurer that relocated to Vanuatu after having its Australian licence denied.

Despite the setback, the brokerage is still suing APRA for $40 million for defamation.

At the time R&G Insurance Broking told Sunrise Exchange News it shared nothing with Rural & General International Insurance other than its name.

It later said that Charles Pratten ­– the former CEO of Rural & General Insurance (when it was located in Australia) – worked in the company as a broker and in the group’s business development and risk compliance divisions. It said Mr Pratten was also a director of Rural & General International Insurance.

APRA says Mr Stephenson was accountable for the brokerage:

• Failing to comply with the requirements of APRA’s inspector;
• Failing to comply with the conditions on its insurance authorisation;
• Failing to keep proper records;
• Breaching APRA’s prudential standards under the Insurance Act;
• Providing misleading and incomplete information to APRA, the inspector and its actuary and auditor, with the result that the company’s financial accounts and statutory returns were misleading.

APRA Deputy Chairman Ross Jones said in a statement conduct which results in the regulator and the market being misled about an insurer’s true financial position will not be tolerated.

But Mr Stephenson denies he has done anything wrong and says APRA is doing everything it can to cause grief in the lead-up to the defamation proceedings. “As a result I have been greatly injured in my character, credit and reputation and have been brought into public hatred, ridicule and contempt,” he told Sunrise Exchange News yesterday.

“Under the circumstances I am of the view that APRA has acted in contumelious disregard of my rights, and I am concerned that APRA has no genuine desire to treat any submission from me for reconsideration with fairness or objectivity.”