SFO lays 28 charges against former Herbert Insurance boss

Thursday 31st May 2012

The Serious Fraud Office has laid 28 charges against former Herbert Insurance Group boss Grant Herbert, alleging he used client funds to finance his lifestyle.

The failed insurance broker's former owner and director, Herbert, appeared in the Auckland District Court facing charges under the Crimes Act and Secret Commissions Act, the SFO said in a statement.

The white-collar crime investigator alleges Herbert committed theft by a person in a special relationship, used a forged document in relation to obtaining credit, a number of offences in relation to corruptly giving an employee of a customer secret commissions for referring insurance business to the Herbert Insurance.

"In the current economic conditions, confidence in the insurance industry and good insurance cover in particular, is more important than ever," chief executive Adam Feeley said. "It has been reassuring that the insurance companies for whom HIG acted as a broker, and who in many instances knew nothing about the insurance cover placed with them, have supported customers, accepted the risk and taken any financial loss themselves."

Last month, the liquidator for Herbert Insurance said the firm may have breached legislation, but it was waiting for the SFO to act before taking any action on behalf of the company's creditors.

Herbert Insurance was put in receivership last year, leaving a $3.1 million shortfall owed to insurers.

Last year, receivers for Herbert Insurance and its companion entity Herbert Securities sold its customer base of some 4,500 people to Aon New Zealand, though there will likely be a shortfall to secured creditor ASB Bank, which is owed $780,000.

BusinessDesk.co.nz

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