Australian regulator ordered to stay disqualification of former Zurich Australia Insurance chief executive John Butler...
The Australian Administrative Appeals Tribunal (AAT) has ordered the Australian Prudential Regulation Authority (APRA) to stay its decision to disqualify former Zurich Australia Insurance (ZAIL) chief executive John Butler.
On 6 February, the regulator took the decision to disqualify Butler from being or acting as a director or senior manager of a general insurer, authorised non-operating holding company or agent of a foreign general insurer.
The regulator had previously accepted an enforceable undertaking from Zurich Australia and Zurich Financial Services arising from two financial reinsurance transactions with General & Cologne Re Group Australia that were undertaken in 2000. The transactions resulted in Zurich Australia's profits in 2000 being overstated by $61m with the effect that Zurich Australia appeared to meet the regulatory solvency requirement when it did not.
Butler subsequently sought the regulator's reconsideration of its decision and at the same time applied to the Administrative Appeals Tribunal (AAT) for a stay of APRA's decision to disqualify him, pending completion of APRA's reconsideration.
On 15 February 2007 the AAT ordered that the operation of APRA's decision to disqualify Butler be stayed until 2 March 2007 when the reconsideration must be completed.