FSA fines GoshawK
UK regulator Financial Services Authority (FSA) has fined a subsidiary of GoshawK £220,000 over breaches of FSA rules in 2002 and 2003.
The fines were levied on GoshawK Syndicate Management Ltd, the company which managed GoshawK's ill-fated Syndicate 102.
In its statement to the London Stock Exchange today (12 October), GoshawK said its: "Current senior management was not responsible for the breaches and has been open and co-operative with the FSA during the FSA's investigations."
GoshawK added: "The Company has also received written confirmation from Lloyd's that it will not bring disciplinary procedures against GSML in respect of the matters subject of the FSA fine".
GoshawK's Syndicate 102 closed in 2003 after a series of catastrophic underwriting losses - including exposures to viatical policies and legal expenses insurance from the failed The Accident Group - brought the Syndicate to its knees. The company has not admitted any liability under the fine.
Under a new management team of ex-R&SA UK chief executive Paul Spencer, and former ACE Tempest underwriter Russell Brooke, the company has focused on its Bermudian reinsurance arm Rosemont Re. But the hurricane losses of 2004 and 2005 have weighed down the company's share price to a current 24p. The company has also had to fend off accusations of mismanagement by its largest shareholder, Phoenix Asset Management.
After raising its estimates for Hurricanes Katrina and Rita to $90mn, the company admitted last week that it is considering selling Rosemont Re if it is not able to attract a "significant capital injection".