Two high-ranking Lloyd's brokers have been severely reprimanded by Lloyd's Disciplinary Board for serious charges of misconduct.
Jonathan Chapman, managing director of J A Chapman & Co, was fined heavily and banned from the market for life while, Robert Meacham, a former associate director at T L Clowes, has been fined and suspended for 18 months.
The two cases are unrelated.
Chapman, whose case was heard by the board on February 29, admitted 12 charges of misconduct relating to quoting inflated premiums to underwriters on six occasions.
He has received a life ban from the market and was fined £100,000 and costs of £30,000.
Chapman's company Chapco specialised in Lloyd's marine liability market but is now in liquidation.
On the first occasion, Chapman was found to have inflated the premium by a total of £2.56m, without his client's consent, on a marine account he was handling in 1994 and 1995 for Liverpool and London P&I Association.
Chapco then arranged for £550,000 of excess premiums paid on the London and Liverpool accounts to be posted to Swiss and Cypriot bank accounts, the beneficiaries of which were not entitled to the sum involved.
A later inquiry by Lloyd's revealed that Chapman quoted substantially inflated premiums on five other Chapco accounts. This was said to have happened between 1990 and 1993 and involved a total excess premium of £1.08m.
Part of this sum was found to have been paid to various Liberian companies with bank accounts in Jersey, although none were entitled to the money.
However, Lloyd's said that it could not prove Chapman personally received any of the proceeds of these bank accounts.
Also disciplined on February 21, was Robert Meacham, who admitted three charges of misconduct. At the time he was an associate director at Lloyd's broker T L Clowes & Company but was dismissed in September 1999.
Meacham admitted altering the terms and conditions of an insurance policy to remove any reference to the premium income limit. It was said he did this to conceal from the client the premium income limit imposed by the insurer.
He also admitted failing to disclose that he had negotiated a commission from underwriters at the same time as obtaining one from the client.
And Meacham admitted he had agreed to receive a personal payment from his principal's client as an inducement to show favour.
Meacham received an 18-month suspension from the market and was ordered to pay costs of £1,000.
His firm, brokers T L Clowes, was fined £25,000 and costs.
Lloyd's said these penalties reflected Meacham's previously unblemished record.
A spokesman for Lloyd's said it has passed the papers relating to the Chapman case to the police.