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Herbert Insurance Group owner found guilty

Herbert Insurance Group owner found guilty


Grant Malcolm Herbert (62), the former owner and director of insurance broking firm Herbert Insurance Group Limited (HIG), has been found guilty of 17 Crimes Act charges and seven Secret Commissions Act charges following a jury trial in the Auckland District Court. He has been found not guilty of one Crimes Act charge and one Secret Commissions Act charge.

Mr Herbert originally appeared to face charges in May 2012 following a Serious Fraud Office (SFO) investigation into the failed insurance brokering company.

Between 2005 and March 2011, Mr Herbert received premiums from clients but failed to forward approximately $2.5 million of this to insurers, in some cases leaving the customers uninsured. He diverted this money to pay operating expenses for HIG.

Mr Herbert was found guilty of a number of corruption offences in relation to giving an employee of an insured customer secret commissions for referring insurance business to HIG. That employee was Christopher David Green, a Commercial Property Manager at a home supply company. Mr Green previously entered guilty pleas to receiving secret commissions and was sentenced to five months’ home detention in June 2013. The home supply company was overcharged approximately $220,000 for its insurance. This was split unevenly between Mr Herbert and Mr Green.

Prior to the trial Mr Herbert pleaded guilty to using a forged document in relation to obtaining a credit facility in the sum of $250,000.

SFO Director, Julie Read said, “Mr Herbert breached the confidence and trust of both the insurers he worked with and his clients, many of whom were exposed to potentially significant losses when they were misled by Mr Herbert into believing they were insured. The offending Mr Herbert engaged in undermines the insurance broking industry and the insurance industry itself, which is largely based on trust. Fortunately Mr Herbert had very limited involvement in brokering insurance for Christchurch clients who are currently a priority focus of the insurance industry.”

Mr Herbert was remanded on bail and will be sentenced on 16 October 2014.

ENDS


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