2 Execs at Lloyd’s Insurer TMK Forced to Resign After Sexual Harassment Allegations

June 11, 2019 by

Two executives at a top Lloyd’s of London insurance company have resigned following allegations of sexual harassment. One was accused of groping colleagues at a booze-fueled party, the other of stalking a junior employee.

The first executive was said to have grabbed one colleague’s buttocks, unbuttoned another’s shirt and made lewd sexual remarks at a party for employees of Tokio Marine Kiln Group Ltd., a subsidiary of one of Japan’s biggest insurers, according to people familiar with the matter. The second allegedly bombarded a woman who reported directly to him with unsolicited text messages and emails asking her out on dates, even after she said she wasn’t interested, the people said.

The alleged incidents came to light amid the fallout from a Bloomberg Businessweek article about endemic sexual misconduct in the Lloyd’s of London insurance market. Following publication of the article in March, TMK Chief Executive Officer Charles Franks called a town hall meeting where he condemned the widespread behavior it revealed.

That led several current and former employees to approach a senior lawyer at the firm, Ifeanyi Okoh, to complain about abuse they said they had endured or witnessed at TMK, including the incident at the off-site party. The lawyer emailed Franks and other senior managers criticizing what he called a culture of fear and harassment.

“I have been contacted by several TMK employees and ex-employees who recounted some of the most appalling and shocking details of bullying, intimidation, harassment, victimization, unwanted attention, sexual harassment and racial abuse,” Okoh wrote in the email seen by Bloomberg News. “Sadly, this is part of a longstanding pattern in TMK, one further amplified by systemic intimidation, normalization of harassment and inhibiting reporting.”

Laura Guerin, a spokeswoman for TMK, confirmed that an employee had raised concerns and said the company was reviewing its policies with the help of outside advisers. “TMK’s priority is to ensure the allegations are investigated thoroughly, independently and confidentially,” Guerin said in an email. “TMK has clear standards and policies for workplace conduct. Any breach of these will be taken extremely seriously and would not reflect our company values.”

The executive accused of groping colleagues was given the option of resigning after he was reported to TMK’s human resources department, according to people with knowledge of the matter. He received a payout of more than 200,000 pounds ($254,000) after denying culpability and arguing that the company was in part responsible for any drunken behavior at the party because it had supplied free alcohol for several hours, one of the people said. The executive now works outside the London insurance market.

The incident apparently wasn’t an isolated one. Three other current and former TMK employees, who asked for anonymity because they feared speaking publicly would hurt their careers, said it was common at work social events to be grabbed or harassed by colleagues who were drunk. One said in an interview that her buttocks were fondled several times at office parties by male underwriters who denied they had done anything when challenged. The woman, who asked not to be named and no longer works at the firm, said she didn’t report the groping as it was standard behavior and she didn’t believe anything would come of it.

The woman who was allegedly stalked told colleagues she was subjected to a four-year campaign of sexual harassment, according to people familiar with her case. The executive allegedly would sit next to her at meetings and work-related social events so he could fondle her legs under the table. She claimed he once turned up outside her home uninvited and attempted to kiss her on the mouth, the people said.

The woman told friends she was too worried about losing her job to go to HR. But she eventually did after the executive sent an email to her personal account describing a “secret dream” he had about holding her hand while walking along a beach, the people said. The executive resigned and now works for another insurance business.

“The types of behavior described do not in any way reflect the values of TMK,” Franks said in an emailed statement to Bloomberg News in which he expressed support for the internal investigation and promised to follow through on any recommendations.

TMK is the Lloyd’s of London underwriting arm of Tokio Marine Holdings Inc., Japan’s oldest insurance company. The unit employs about 900 people and manages three underwriting syndicates at Lloyd’s, making it one of the largest so-called managing agents at the exchange.

The TMK sexual-harassment allegations are the first in the Lloyd’s insurance market to become public since the exchange’s CEO, John Neal, pledged in March to crack down on the misconduct reported by Bloomberg. Neal has written to market participants warning them that anyone involved in inappropriate behavior could potentially be banned for life from the 331-year-old insurance market and publicly named and shamed.

A spokeswoman for Lloyd’s said the company has had ongoing discussions with TMK and is “satisfied that they are taking these reports extremely seriously.” She said Lloyd’s has been “very clear on the standard of behaviors we expect and the actions we will take to ensure that our market, and all of those who work in it, operate to the highest standards.”

Okoh’s email to top TMK executives was forwarded to Britain’s Financial Conduct Authority, the Bank of England’s Prudential Regulatory Authority, the Metropolitan Police and Lloyd’s, one of the people said. It isn’t known whether any of the regulators or the police are investigating. Spokesmen for the FCA and the PRA declined to comment. The Metropolitan Police didn’t respond to phone calls and emails seeking comment.

TMK was already in the financial regulator’s crosshairs following governance and risk failures in recent years, three of the people said. The PRA was concerned enough about the way the firm was being run that it was placed under heightened scrutiny last year.

“We are in regular dialogue with the PRA and committed to ensuring robust governance controls and processes across our entire business,” Guerin, the spokeswoman said. “TMK is well-capitalized and our owners, Tokio Marine Holdings, support our strategy and approach.”

Some of the half dozen men and women interviewed by Bloomberg said they were afraid of reporting their concerns to human resources because they believed it would get back to their bosses and hurt their careers.

Guerin, the TMK spokeswoman, said the company has urged employees to come forward with any concerns. “They can speak, in confidence, to a member of senior management or an independent whistle-blower helpline,” she said. “Workplace harassment will not be tolerated.”

Okoh, currently on leave from the firm, sounded a different note in his email. “This is a crisis and an existential threat to the TMK brand and reputation,” he wrote, “which requires immediate and very urgent action!”

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