Former Lloyd's of London CEO breached conduct rules, investigation rules

By Kirstin Ridley

LONDON, July 22 (Reuters) - Former Lloyd's of London CEO John Neal's undisclosed relationship with an ex-corporate affairs director breached the commercial insurance market's compliance policy and procedures, Lloyd's said on Wednesday.

One year after Neal's departure after more than six years as CEO, a drawn-out investigation found that the relationship had been "sufficiently close during their employment ... that it could be viewed as creating a perceived conflict of interest".

But there was no conclusive evidence that Neal and Rebekah Clement were involved in a romantic relationship while at the corporation - and no evidence of process failures linked to a promotion of Clement, the Council of Lloyd's said in a statement.

Nevertheless, Neal's conduct fell significantly below the standards expected of senior leaders and was detrimental to the interests of the corporation and Lloyd's market, it said, while Clement should have "modified her behaviour" and disclosed the perceived conflict of interest.

The council is responsible for the management and supervision of the insurance market.

Neal did not immediately respond to a request for comment sent over LinkedIn.

Clement's lawyers, Irwin Mitchell, said she was "hugely disappointed" at the findings and was considering legal action.

"For over a year there have been repeated leaks and press briefings about Rebekah, without warning or regard for the damage done to her career, reputation and health," said Shah Qureshi, an employment lawyer at Irwin Mitchell.

"While Rebekah is pleased that this protracted investigation has come to a close, she has put Lloyd's and its senior officers on notice that she is considering legal proceedings."

Senior Lloyd's individuals had raised concerns directly with Neal regarding the nature of his relationship, but the investigation, which was supported by external lawyers, found no evidence of a material change in his conduct, the council said.

He also failed to ensure whistleblower reports made in November 2023 were properly handled, it added. Lloyd's said it could not share the nature of the allegations.

"The council considers that Mr Neal's conduct therefore constitutes a breach of the Lloyd's compliance policy and his employment contract," it said in a statement.

Lloyd's remuneration committee has written to Neal to tell him his conduct would have warranted the cancellation of a proportion of unvested remuneration, had he retained any, the council said. But Neal forfeited unvested compensation when he resigned last year.

(Reporting by Kirstin Ridley; Editing by Louise Heavens and Emelia Sithole-Matarise)