Over 100 of current and former employees of Prudential Life Insurance had engaged in acts of misconduct, defrauding around 500 customers of a total of roughly ?3.1 billion ($19.6 million), the company revealed on Friday.

The Japanese subsidiary of the American insurance company announced that its CEO will be stepping down next month to take responsibility over the incidents.

In June 2024, a former employee of the company was arrested over alleged fraudulent activities. Other cases of misconduct, such as improper investment solicitations, came to light following the arrest, prompting the company to launch an internal investigation in August of the same year.

Last year, after another former employee was arrested on suspicion of leaking customers¡¯ personal information, the Financial Services Agency ordered the firm to report measures to prevent a recurrence of acts of misconduct involving former employees.

In the investigation, the company confirmed that three of their former employees had engaged in the embezzlement of funds connected to Prudential Life¡¯s systems and insurance business while working for the firm. They defrauded eight customers of some ?60 million by misleading them into thinking that the funds were part of business transactions, with some of the cases dating back to 2017.

The firm also found that 106 of its current and former employees had engaged in other fraudulent activities not directly related to its insurance business. These included soliciting for investment products not connected to the company¡¯s insurance business or taking personal loans from customers. A total of 498 customers were defrauded of around ?3 billion as a result of these activities.

The firm said it is working on compensating the affected customers and is also extending its cooperation to the police in relation to the cases.

Prudential Life said that the incidents in which employees took advantage of their close relationships with customers had most likely occurred due to reasons such as the lack of proper oversight by management, which failed to flag such activities.

Additionally, an overly performance-linked compensation system could have led to an environment centered on financial gains and heightened the risk of misconduct by creating income instability among its sales staff, the company said.

Prudential Life CEO and President Kan Mabara will step down on Feb. 1 to take responsibility for the series of incidents. He will be replaced by Hiromitsu Tokumaru, the current president and CEO of Prudential Gibraltar Financial Life Insurance, a group company of Prudential Life.