The Australian Prudential Regulation Authority (APRA) has handed Zurich Australian Insurance Limited its report on the reinsurance contract Zurich bought in September 2000 from General Cologne Re Australia.

The local arm of Zurich is in the clear, yet APRA may disqualify former Australian-based executives of General Cologne Re. It is still finalising action against the individuals but no criminal actions will be pursued.

APRA says the report was released to Zurich after obtaining the Federal Attorney-General’s advice, as required by the Insurance Act.

The reinsurance transactions resulted in Zurich’s profit for 2000 being overstated by $61 million, at a time when the company was at risk of regulatory insolvency.

APRA accepted enforceable undertakings from Zurich in May 2005 regarding the transactions.

It is satisfied Zurich has undertaken all necessary corrective action in relation to the transactions and there will be no further action.

As a result of the investigations APRA has taken action against former Zurich executives.
It accepted an enforceable undertaking from Richard Mayo in August 2004, disqualified John Stanbridge in November 2006, disqualified Florian Salzgeber in January this year, disqualified Robert Stevenson and John Butler in February, and disqualified Alan Parsonson earlier this month.