Senior RSA figure denies ex-chief executive Philip Smith’s claims

A senior RSA executive who jointly conducted an investigation into financial issues at its Irish insurance subsidiary late 2013 has denied claims by Philip Smith, the former chief executive of its Irish unit, that the findings were pre-ordained.

Derek Walsh, group general counsel and company secretary of RSA plc, told the Employment Appeals Tribunal today that it was like being "stabbed in the head".

“It’s 100 per cent wrong,” Mr Walsh added during day four of a hearing brought by Mr Smith against RSA for constructive dismissal in 2013.

The claim was made by Mr Smith earlier this week. Mr Smith said he had been made the “fall guy” by RSA when certain issues around reserving emerged at the Irish business in October 2013 and he raised questions about how the investigation was handled.

Mr Walsh said claims by Mr Smith that the investigation had operated outside its terms of reference by commenting on his character and management style were not correct.

Some 21 people were interviewed in relation to issues around RSA Ireland’s reserving for large loss claims and Mr Walsh said a number of people raised the issue of the culture within the organisation and Mr Smith’s aggressive management style.

He said this involved “professional men weeping and crying” and “shaking with fear” during their interviews. “It was truly awful,” he said. Mr Walsh added that the report’s references to the culture at RSA Ireland didn’t go “within a country mile” of what the investigators had been told.

Mr Walsh said he had offered his support to Mr Smith at a meeting in London in October 2013 about the issues involved. He said this was based on Mr Smith’s excellent performance up to that point as head of the Irish business and their good relationship at the time.

But he said Mr Smith had put “roadblocks” in the way of the investigation by not attending suggested interviews. In some cases, this involved Mr Smith stating ill health and in others it was due letters from his lawyers seeking certain answers from RSA.

Suspended

Mr Smith resigned in late November 2013, taking himself outside the scope of the investigation. He had been suspended by the company earlier that month.

The hearing was also told of RSA sending over a fraud investigator, who was a former police officer, from the UK to investigate Mr Smith’s expenses after issues came to light from its investigation.

In addition, Mr Walsh told the hearing that Peter Burke, former claims director at RSA Ireland, had admitted to him that he had produced three versions of minutes of a meeting held in Ireland about certain insurance claims and sent a misleading version to London. Mr Walsh said Mr Burke told him this was to avoid repercussions from Mr Smith.

Mr Smith’s counsel challenged this evidence as being outlandish but Mr Walsh insisted that this is what Mr Burke had told him. Mr Burke was subsequently dismissed by RSA.

Rory O’Connor, former chief financial officer of RSA Ireland, also provided testimony to the hearing. The final three witnesses are due before the hearing today.