Wells and two directors resign from CBL board

John Wells resigned as chairman of CBL and two other directors joined him in departing the board after the Financial Markets Authority said it was concerned the failed insurer had breached disclosure and reporting rules and directors hadn’t met their fiduciary obligations.

The watchdog is working with the Reserve Bank and Serious Fraud Office in investigating the insurer after prudential supervisors in New Zealand and Ireland sought interim liquidation orders in their respective jurisdiction.

The FMA has been investigating CBL’s disclosure amid fears the public market rules were breached, and yesterday said a preliminary assessment raised concerns the insurer potentially breached Financial Markets Conduct Act and Companies Act rules around initial public offering disclosure, continuous disclosure as a listed entity, financial reporting, and directors’ duties.

It also said it’s considering Deloitte’s role as auditor of the firm.

CBL appointed voluntary administrators in March after the Reserve Bank sought an interim liquidation of the New Zealand-supervised arm and the Central Bank of Ireland made similar moves against CBL’s European division.

A statement from CBL’s board yesterday acknowledged the contribution of Wells, Paul Donaldson and Ian Marsh.

Wells said: “I particularly regret we have been unable to communicate directly with shareholders and other parties as I would have wished, given the nature of the administration and interim liquidation processes.

“We now feel we can simply do no more for shareholders and with little power or authority, our resignation is the appropriate option in these circumstances, and provides clarity and certainty over our position.”