The FSA says Vukelic lacked integrity during his five-year term at Alternative Solutions, the business unit established by the General Reinsurance Corporation to develop and market financial reinsurance products.
During his time at AltSol, from August 1997 until October 2002, Vukelic was responsible for overseeing and structuring three different transactions that were designed to allow the client insurance companies to hide very significant losses in their accounts.
The FSA says Vukelic knew that the deals were not genuine reinsurance transactions and that they could be used to mislead the clients’ auditors. Two of the three client insurance companies subsequently collapsed with wide-ranging consequences.
The Tribunal found that Mr Vukelic had “turned a blind eye” to the true nature of the contracts and was “reckless as to whether they were intended to mislead auditors and others”.
FSA director of enforcement Margaret Cole says: “This case has been fought every inch of the way by Mr Vukelic. We are determined to take whatever action is necessary to ensure that individuals should not avoid the consequence of their actions. The Tribunal rightly criticised his persistent failure to recognise his shortcomings.
“Those carrying out senior functions in regulated firms need to be clear that the FSA will hold them to the highest standards of behaviour and will take action against those who fall short. There is no place in financial services for the sort of behaviour demonstrated by Mr Vukelic.”