Former RSA Insurance Ireland chief financial officer Rory O’Connor has been disqualified for 8 years 4 months and fined €70,000 by the Central Bank of Ireland for his admitted participation in a breach of financial services law by the company.

The fine follows O’Connor’s admitted participation in the insurer’s failure to maintain sufficient technical reserves from February 2010 to 30 September 2013. The enforcement action followed a separate investigation conducted by the Central Bank in respect of RSAII, at the conclusion of which the Central Bank reprimanded RSAII and imposed a financial penalty of €3.5m in December 2018.

The Central Bank’s investigation found that deliberate and wrongful under-reserving of large loss claim reserve estimates resulted in incomplete and inaccurate information being relied upon in the calculation of RSAII’s technical reserves. The investigation found that the claim reserve estimates on RSAII’s claims database were understated in the sum of approximately €29m as at 30 September 2013.

The Central Bank’s director of enforcement and anti-money laundering, Seána Cunningham, commented: “For over three and a half years, in his roles as chief financial officer and executive director on the board of RSAII, Mr O’Connor knowingly participated in the systematic under-reserving of large loss claims, actively facilitated the on-going operation of the under-reserving and concealed it from the Central Bank through the provision of inaccurate financial information.

“The under-reserving of large loss claim reserve estimates directly contributed to the understatement of RSAII’s technical reserves and resulted in the firm’s financial position being artificially enhanced. The failure to maintain adequate technical reserves led to significant risk for policyholders in the event that RSAII did not hold sufficient assets to meet its liabilities and was, as a result, unable to pay claims made against and by its policyholders. Mr O’Connor’s conduct in this case was deliberate and fell far below the standards expected of him in the roles he held in RSAII.”

Share Story: