Prudential Gibraltar Financial Life Insurance Co. said employees seconded to contracted agencies in Japan removed operational information without authorization and shared it internally, adding a new compliance issue to Prudential Financial Inc.’s Japan life operations.
According to Reuters, the Japanese life insurer said 11 seconded employees took operational data on 379 occasions from seven contracted agencies and passed it to other Prudential staff. The information related to agency operations, including sales performance, and was used by Prudential personnel to plan sales promotion strategies. “Both the seconded employees who removed the information and the employees who received it lacked a fundamental understanding of the rules and failed to perform basic compliance actions,” Prudential Gibraltar Financial Life Insurance said in a statement.
Prudential Gibraltar said it will end the use of life insurance secondments by the end of March. It also said some former and current executives intend to return part of their compensation on a voluntary basis. After reviewing all identified cases with the affected agencies, the company stated that “no issues were identified that would raise concerns under the Unfair Competition Prevention Act, nor was there any inappropriate removal of contract information.” The disclosure follows the earlier resignation of the chief executive of Prudential’s Japanese life business, after previously reported misconduct involving about 100 employees and transactions totalling around ¥3.1 billion.
Separate from the Gibraltar unit, The Prudential Life Insurance Company, Ltd. (“Prudential of Japan”) has set out findings from an internal investigation and a “customer confirmation” program launched in August 2024 to identify problematic monetary dealings by current and former employees. Through letters, outbound calls, email, website notices, and newspaper advertisements, Prudential of Japan contacted policyholders and former policyholders to ask whether they had experienced suspicious money handling. The company reported that three former sales employees engaged in inappropriate handling of money linked to Prudential Life’s systems or life insurance operations, affecting eight customers and causing losses of about ¥60 million. The insurer is compensating those customers and intends to seek reimbursement from the former employees.
The review also identified a wider range of monetary conduct not directly connected to Prudential’s own products. According to the company, 106 current and former employees engaged in other types of inappropriate monetary activity, including investment solicitations unrelated to Prudential Life and personal borrowing from customers. Those employees received about ¥1.63 billion while employed and about ¥1.45 billion after leaving the company, involving 498 customers in total. In addition, 69 current and former employees introduced customers to investment products and firms not approved under Prudential Life’s internal rules.
While those employees did not themselves receive money in those cases, customers paid approximately ¥970 million to the introduced firms while the employees were still with the company and about ¥340 million after their departure. Some customers did not recover their funds from the external entities. Prudential of Japan said it has taken disciplinary action and, in some instances, has provided information to law enforcement.
In February 2026, Prudential of Japan and its US parent, Prudential Financial, announced a voluntary 90‑day suspension of new sales at the Japanese life insurer, beginning Feb. 9. The suspension is intended to allow implementation of operational, organisational and governance changes and the launch of an independent customer reimbursement program. The pause follows an internal investigation into misconduct by certain employees, including inappropriate investment solicitations. Prudential of Japan has announced measures to reimburse affected customers, revise employee incentive compensation, tighten oversight of sales practices, and strengthen governance and risk management. The company also plans to expand training and adjust recruitment standards for sales staff and managers.
The changes come alongside shifts in senior leadership. Kan Mabara, president and CEO of Prudential of Japan, stepped down as of Feb. 1, and will not remain as an adviser. He was succeeded by Tokumaru, who previously served as president and CEO of Prudential Gibraltar Financial Life and, according to the company, has not been involved in Prudential of Japan’s prior management. At the Japanese holding‑company level, Bradford O. Hearn became president and CEO of Prudential Holdings of Japan, Inc. in October 2025 following the resignation of the chair and CEO.
Prudential of Japan and Prudential Holdings of Japan have linked the misconduct to weaknesses in sales oversight, incentive structures, risk management, and corporate culture. Management said that limited supervision of sales activities at branch level, along with insufficient checks by head office, allowed sales staff to form close customer relationships without consistent monitoring. They also cited a compensation structure heavily tied to new business as a factor that increased the risk of inappropriate conduct. The companies pointed to gaps in the “three lines of defence” risk framework, including unclear role definitions between front‑line and risk/compliance functions and limited first‑line ownership of compliance and risk. An entrenched view of the legacy business model was also cited as a barrier to earlier structural change.
In response, Prudential of Japan has outlined a set of reforms that include:
Prudential of Japan said it will continue to compensate affected customers, apply disciplinary measures, and cooperate with authorities where required. Prudential Holdings of Japan said it will increase oversight of its life subsidiaries as these measures are implemented in response to the misconduct findings in Japan’s life insurance market.
