(Jan 23): Prudential Financial Inc’s Japan insurance head vowed to bolster governance after revelations that improper actions by more than 100 current and former staff cost customers about US$20 million ($25.6 million).
The chief executive officer of the unit, Kan Mabara, “deeply” apologised for “multiple inappropriate cases,” at a news conference in Tokyo. Prudential Life Insurance Co had said in a statement last week that employees had received ¥3.14 billion from customers through improper acts. It said last week that Mabara will step down on Feb 1.
Company executives at the news conference said the pay structure relied heavily on commissions, distorting employee incentives to follow rules.
“We have attracted those who have an excessive desire to make money,” Mabara said. “We had to take extra care in managing them, but we were not as alert to risks as we should have been.”
Japanese policymakers are trying to boost investment activity by individuals as the nation’s shrinking and ageing population puts pressure on government finances. Troubles with customer accounts at financial firms would go against that drive. At Prudential Life, staff have been checking with customers since August 2024 following the discovery of multiple cases of impropriety.
An internal investigation showed that about 106 current and former employees solicited around 500 customers for investment products that weren’t approved by the firm, including cryptocurrencies.
See also: BOJ holds rate with stronger inflation view giving hawkish edge
Uploaded by Magessan Varatharaja
