Bermuda’s financial regulator has released details on why it decided to indefinitely bar Joakim Samuelsson from holding senior roles in the island’s insurance industry.

In a statement, the Bermuda Monetary Authority said its extensive findings of regulatory breaches and failures in his conduct as a director, officer and controller of failed Bermudian re/insurer Custodian Life, included improper trading practices, inaccurate and misleading public disclosures, and failure to co-operate with an investigator.

On March 27, the BMA issued a prohibition order against Mr Samuelsson that prohibits him from acting as a controller, director, officer, chief executive, senior executive or associate of any entity or person registered under the Insurance Act.

Custodian was placed into provisional liquidation in November 2023, and in October last year the court ordered that the company be wound up following findings of extensive and longstanding regulatory breaches.

The BMA concluded that Mr Samuelsson had “failed to conduct and manage the business of Custodian in a prudent manner and demonstrated a lack of competence, diligence and soundness of judgment”. His conduct was a direct cause of the company’s regulatory breaches and the resulting liquidation, the regulator added.

The BMA’s findings included:

• The operation of improper trading practices, including undisclosed shorting of policyholder-directed investments, which exposed policyholders to Custodian’s own trading risks

• The use of an imprudent segregation model that failed to provide meaningful protection to policyholder assets

• Inaccurate and misleading statutory and public disclosures concerning the funding and ring-fencing of segregated accounts

• Failures to cooperate with an investigator appointed under Section 30 of the Act

• Serious outsourcing and records-control failures that impeded the BMA’s regulatory oversight and the work of joint provisional liquidators, which were appointed by the Supreme Court of Bermuda (Court)

• Failures to cooperate with the joint provisional liquidators

• Failure to comply court with orders, resulting in contempt of court findings.

“Taken together, the Authority determined that this conduct evidenced serious and sustained failures of probity, integrity, competence and soundness of judgment, which demonstrated that Mr Samuelsson was not a fit and proper person to perform functions in relation to regulated activities,” the BMA stated.