Settled
Prudential Life gets third-party report; Oct. 8 briefing as FSA weighs suspension
Version 2: Two more outlets, TBS and Nippon TV, have filed their own reports, confirming that the company received the report on Oct. 3 and that the president will appear at the Oct. 8 briefing; no new facts about the case itself emerged.
In short
Prudential Life Insurance said on Oct. 5 that it has received the investigation report from the external special committee examining how more than 100 employees and former employees improperly took money from customers. The company will publish the full report and hold a press conference on Oct. 8, where President Hiromichi Tokumaru is to explain prevention measures, in Tokyo according to Sankei. The Financial Services Agency is preparing a partial business suspension order that would bar new insurance sales, with Nikkei reporting the period is expected to run three months.
Why it matters
A partial business suspension order would stop Prudential Life from selling new policies, pushing back any resumption of sales beyond the self-imposed halt running through early November and leaving the timing in the regulator's hands. The case also centres on a sales-incentive system weighted toward results and on management responsibility, which Sankei says are focal points and which the Oct. 8 briefing is expected to address.
Key facts
- Prudential Life Insurance announced on Oct. 5 that it received the investigation report from the external special investigation committee looking into the improper taking of money from customers. [ 1 , 2 , 4 , 5 , 6 , 7 , 8 ]
- The company will publish the report and hold a press conference on Oct. 8; TBS, Sankei and Nippon TV reported that the company said it received the report on Oct. 3. [ 2 , 4 , 5 , 8 ]
- President Hiromichi Tokumaru is to attend the Oct. 8 briefing and explain prevention measures, with Nippon TV reporting that other executives will also take part. [ 2 , 5 , 8 ]
- In January the company disclosed that more than 100 employees, including former employees, had improperly received about ¥3.1 billion in total from customers; Mainichi reported the figure involved roughly 500 customers. [ 1 , 2 , 5 ]
- In July the company added about ¥620 million to the compensation it would cover, and Nikkei said the damage had expanded. [ 1 ]
- The company has suspended new sales activity from early February to early November, according to Nikkei and Sankei. [ 1 , 5 ]
- The Financial Services Agency plans to issue a partial business suspension order under the Insurance Business Act, which would bar new insurance sales; Nikkei reported the period is expected to be three months. [ 1 , 2 , 5 , 8 ]
- Sankei reported that the FSA had issued a reporting order and carried out an on-site inspection. [ 5 ]
Confirmed by several sources
- Prudential Life received the third-party investigation report and will publish it and hold a press conference on Oct. 8. [ 1 , 2 , 4 , 5 , 6 , 7 , 8 ]
- President Hiromichi Tokumaru is to hold the press conference and explain the findings and prevention measures. [ 2 , 5 , 8 ]
- The company disclosed in January that more than 100 employees and former employees had improperly received over ¥3.1 billion from customers. [ 1 , 2 , 5 , 7 ]
- The Financial Services Agency is preparing to order a partial suspension of Prudential Life's business. [ 1 , 2 , 5 , 7 , 8 ]
- The company said it received the committee's report on Oct. 3, according to TBS, Sankei and Nippon TV. [ 4 , 5 , 8 ]
- Prudential Life has suspended new sales activity from February to November. [ 1 , 5 , 8 ]
Still unclear
- Whether the business suspension order will cover parent company Prudential Holdings of Japan as well as Prudential Life. Only Mainichi reports that the FSA is coordinating to order a suspension covering both the insurer and its parent; the other documents mention only Prudential Life.
- The length of the planned business suspension order. Nikkei reports the period is expected to be three months, attributed to its own reporting; no other document gives a duration.
- Whether employees took money from customers during the company's sales self-restraint period. Sankei reports that such a suspicion has emerged, while the other documents do not address the period.
- Who within management will take responsibility and whether the sales-incentive system will be changed. Sankei describes the pay system and management responsibility as focal points, but no decision or outcome is reported.
What local media are saying
Business mediaThe business press focused on the handover of the third-party report, the Oct. 8 press conference with the president, the regulator's planned partial suspension of business, the scale of the misconduct and the expanded compensation. Sankei added that employees may have taken money even during the sales self-restraint period and noted that the FSA had issued a reporting order and conducted an on-site inspection, while TBS's later report describes improper transactions of more than ¥3 billion with customers.
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Official sourcesNHK reported that the company had received the committee's report on the facts and background and that a press conference is scheduled for Oct. 8, without further detail on the FSA's planned action or the scale of the losses.
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Timeline, local time
- Nikkei reports that Prudential Life received the investigation report and will publish it in full and hold a press conference on Oct. 8. [ 1 ]
- Mainichi reports the press conference will be held at 3 p.m. on Oct. 8, with President Hiromichi Tokumaru explaining prevention measures. [ 2 ]
- TBS reports the company said it received the committee's report on Oct. 3. [ 4 ]
- Sankei reports the third-party committee's results were received on Oct. 3 and that the FSA is considering a partial business suspension order. [ 5 ]
- NHK reports the company received the committee's report and will hold a press conference on Oct. 8. [ 6 ]
- TBS reports the company received the investigation report and will publish the findings and hold a press conference on Oct. 8. [ 7 ]
- Nippon TV reports the company will hold a press conference on Oct. 8, with President Tokumaru and other executives expected to attend. [ 8 ]
- Press conference scheduled for Oct. 8 at 3 p.m. in Tokyo. [ 2 , 5 ]