Prudential Life Extends Sales Suspension by 180 Days

Tokyo, April 22 (Jiji Press)–Japan’s Prudential Life Insurance Co. said Wednesday that it will extend its voluntary suspension of sales activities for new contracts by 180 days, following a fraud scandal involving its employees. The suspension was originally scheduled for 90 days from February in response to the scandal, in which employees swindled a total of about 500 customers out of some 3.1 billion yen. But Prudential Life concluded that more time is needed for fundamental reforms, including a review of sales and management systems, the company and its parent, Prudential Holdings of Japan Inc., said in a statement. The two companies, both based in Tokyo, belong to U.S. financial giant Prudential Financial Inc. Additionally, a survey is being conducted into about 70 suspected fraud cases involving Gibraltar Life Insurance Co., another Prudential Financial group company. Prudential Life President and CEO Hiromitsu Tokumaru and other executives will hold a press conference later on Wednesday to explain their future steps. Prudential Life also announced the progress of compensation. As of Friday, an independent committee’s review process has been completed or compensation payments have been made for 259 individuals, totaling 1.7 billion yen. The company aims to complete compensation by this autumn. Separately, it will investigate about 700 cases in response to customer complaints. Since 1991, more than 100 Prudential Life employees have been found to have illegally received money from customers. Japan’s Financial Services Agency has conducted an on-site inspection of Prudential Life, investigating its sales staff management system. It has also launched an inspection of Prudential Holdings of Japan. END [Copyright The Jiji Press, Ltd.]