Royal London strikes deal over fined director
Agreement with Utility Capital Management comes after firm said it may seek to recover losses related to £3.6m unauthorised payments.
Royal London and Utility Capital Management have come to a confidential settlement regarding a dispute over former Royal Liver finance director George McGregor, an official statement has confirmed.
It comes after Royal London, which acquired Royal Liver last year, said it may seek to launch legal action to recover millions of pounds in losses related to £3.6m unauthorised payments sanctioned by Mr McGregor, to other companies.
While the other companies were not named in an FSA final notice issued to Mr McGregor last month alongside a £109,000 fine, it was reported in May 2010 that Royal Liver had launched an investigation into contracts set up by Mr McGregor with James Stuart-Smith, former chief investment officer for Royal Liver, who left to found Utility Capital Management in 2009.
A statement from UCM released this week said: “Royal London Mutual Insurance Society Limited and Mr James Stuart-Smith, Utility Capital Management Limited and Utility Capital Management LLP announce they have settled the dispute between them, the terms of which are confidential.”
John House, chairman of UCM, said: “We are pleased to have reached a settlement. The potential distractions of the dispute are now removed, and the FSA final notice on Mr McGregor made clear that any wrongdoing was confined to his actions.
“In the meantime, UCM has been growing its successful business, improving insurers’ solvency and investment returns: insurers need better, more capital efficient ways to invest, and so there is a lot of demand for UCM’s investment advisory services.”
A spokesman for Royal London said: “We have settled the dispute. The terms are confidential. The dispute was not between Royal London and UCM, but Royal Liver and UCM. This draws a line under the issue.”
In 2010, it was reported Mr McGregor had been sacked from Royal Liver when the unauthorised contracts were discovered. At the time, a Royal Liver spokesman said the mutual was considering legal action, depending on the results of the FSA investigation.