Ten years ago, the well renowned ‘Independent Insurance’ was the cream of the crop, the darling of the city, the big dogs. Then there followed a tumultuous journey which took them from the very top, to rock bottom, liquidation, a Serious Fraud Office investigation, and jailing of staff members being stops along the way.
However the writing was on the wall; in 2001, even though they were ranked the UK’s 171st largest listed company, Independents share price fell from 400p to 81p, then trading ceased on June 11.
With a reputation for having ‘the best quality underwriters’ and being known for looking out for the smaller brokers, it’s hard to see why the numbered days of Independent were compared to the final days of Margaret Thatchers reign.
Liquidators Pricewaterhouse Coopers were unable to save the company, and set about the unenviable task of unwinding the tightest of coils.
In 2007, the gruesome tail came to its climax with the finale of all finales, the jailing of CEO Michael Bright, deputy Managing Director Philip Condon, and Director of Finance Dennis Lomas. They were all found guilty of conspiracy to defraud.
March 2001 saw a determined Michael Bright, despite the fact profits had dropped by almost £30million. Operationally though, Independent had experienced a strong rise in written premiums.
Perhaps it was for this reason that Bright invested £71,000 into company shares, followed closely by staff inspired by his lead. With the benefit of hindsight, it is an investment most would not make again.
It was at this time that at a conference in Spain, Bright proudly announced his predictions for where the business was going. Double the size was the cry. A month later it was announced Bright, Condon and Lomas were effectively halving their annual salaries by going without their bonuses.
Rumours of outside investment became prevalent, with AIG and Allianz always closely linked with a possible takeover. However the next board meeting saw the resignation of Bright, with an external CEO the most likely outcome.
It’s ironic that Pearl Harbour was the number one film in the UK at this time, because an immense bombardment was coming towards Independent. The Serious Fraud Office were scrutinising every book, FSA began its own inquest and broking action groups mobilised, and Independent sunk to the depths, never to recover.
By Ben Malkin
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