The head of Prudential Financial Inc.’s Japan life insurance business will leave his role following the discovery of widespread employee misconduct involving customer funds, the insurer has disclosed.
According to Reuters, Prudential’s Japan life insurance unit said chief executive officer and president Kan Mabara will resign effective Feb. 1 after an internal review found misconduct by about 100 employees and former employees. The company said Hiromitsu Tokumaru, currently president and CEO of Prudential Gibraltar Financial Life Insurance, will take over leadership of the Japan life operation on the same date. He will be responsible for overseeing remedial measures at the business and managing interactions with Japanese regulators and distribution partners. The management change follows an internal investigation that began in 2024, when the insurer first reported several cases of inappropriate handling of customer funds. The review was expanded in August 2024 after additional issues were identified.
According to the Japan unit, misconduct identified so far totals around 3.1 billion yen (about US$19.6 million) and involves 498 customers. The cases include employees obtaining money through investment solicitations for personal benefit and instances of staff borrowing funds directly from clients. The company’s review has examined conduct during employment and, in some cases, after individuals left the firm. Japanese daily Asahi reported on the scale of the cases before the latest announcement.
Prudential has not provided a detailed timetable for compensating affected customers or for completing the review. It has also not yet outlined any specific changes to its sales structure, compensation frameworks, or distribution arrangements in Japan. For insurers operating across Asia, the case highlights exposure around producer conduct, particularly where investment-type and savings products are sold, where client money may be moved outside standard processes, and where personal financial dealings between intermediaries and policyholders require strict oversight.
The Prudential Japan investigation is unfolding as regulators in Japan and other Asian markets tighten expectations on market conduct, product suitability, and the treatment of customer assets. Supervisors have increased their focus on the sale of investment-linked and savings products, remuneration design, and governance of large tied-agent and advisory networks. Industry participants are watching whether Prudential’s Japan unit will revise its control framework, expand transaction-level monitoring of investment solicitations, or impose further limits on personal financial transactions between staff and customers. Any regulatory actions, as well as the scale and structure of customer remediation, are expected to be closely followed by insurers with similar business models. For underwriters, reinsurers, and intermediaries, the case reinforces the need to align growth in retirement and savings products with consistent standards for agent onboarding, training, supervision, and enforcement against off-book or informal arrangements.
The developments in Japan come as Prudential Financial reports higher earnings at group level. For the third quarter of 2025, the Newark, N.J.-based company reported net income attributable to Prudential Financial, Inc. of US$1.431 billion, or US$4.01 per common share, compared with US$448 million, or US$1.24 per share, in the same period of 2024. After-tax adjusted operating income was US$1.521 billion, or US$4.26 per share, versus US$1.208 billion, or US$3.33 per share, a year earlier.
Book value per common share was US$90.69 at the end of the quarter, compared with US$84.47 a year earlier. Adjusted book value per common share was US$99.25, slightly above US$98.71 in the prior-year quarter. Assets under management reached US$1.612 trillion, up from US$1.558 trillion a year earlier. Parent company highly liquid assets were US$3.9 billion, compared with US$4.3 billion in the prior-year period. Capital returned to shareholders totalled US$731 million, including US$250 million of share repurchases and US$481 million in dividends. Third-quarter dividends were US$1.35 per common share.
Prudential’s International Businesses segment, which includes Japan, reported adjusted operating income of US$881 million for the third quarter of 2025, up from US$766 million in the same period of 2024. The company said the increase mainly reflected higher net investment spread results, including alternative investment income, and more favourable underwriting results, partly offset by higher expenses to support business growth. On a year-to-date constant dollar basis, international sales totalled US$1.7 billion, up 4% from the prior-year period, with growth driven by Japan and Brazil. For insurance professionals in Asia, the Prudential Japan case illustrates how local conduct issues can arise alongside growth in international earnings, with implications for supervisory engagement, producer management, and the design of controls around investment-related life and savings products.
