Pembroke, Bermuda-based RenaissanceRe Holdings Ltd. said in a Securities and Exchange Commission filing that it will pay $13.5 million to settle a shareholders suit over alleged accounting irregularities and securities fraud.
The company said that on Feb. 14 it executed a memorandum of understanding with plaintiffs' representatives to settle consolidated shareholder class-action securities litigation.
The settlement involves no admission of liability by the company.
RenaissanceRe said a portion of the settlement payment is expected to be offset by insurance recoveries.
The net amount was provided for in the company's 2006 financial statements, it added.
RenaissanceRe went on to say that "the settlement provides for the release of all parties, including the company's present and former directors and officers, including without limitation the defendants who were named in the suits."
The settlement is still subject to court approval.
On Feb. 6, (see NU Online News Service, Feb. 6) the company said it came to a settlement with the SEC over restatement of the company's earnings from 2001 to 2003. The regulatory activity formed the basis of the class action.
The company agreed to pay a total of $16 million related to violations of securities laws and securities fraud. In that settlement the company neither admitted or denied any guilt.
The company was accused of using nontraditional insurance products to distort financial earnings.
In October, three former executives with the company--James N. Stanard, former RenRe chief executive officer; Martin J. Merritt, the former controller; and Michael W. Cash, a former senior executive of RenRe subsidiary Renaissance Reinsurance Ltd.--were hit with securities fraud violations.
According to another filing, Mr. Merritt has entered into an agreement barring him from practicing accounting before the SEC and from serving as an officer or director for any company. A determination of civil fees and penalties has been put off to a future date, the filing said.
RenaissanceRe is a writer of reinsurance and insurance catastrophe risks.
© Arc, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to TMSalesOperations@arc-network.com. For more information visit Asset & Logo Licensing.