FSCO charges leave former Pilot CEO “surprised and disappointed”

One of the men facing charges from Ontario’s insurance regulator says those allegations have left him “surprised and disappointed”. Stu Kistruck, former CEO of Pilot Insurance Co. says it is difficult at this time to comment on the charges he faces because he has only received a short statement from the regulator regarding them and “simply doesn’t have the details”.The Financial Services Commission of Ontario (FSCO) confirmed yesterday the filing of two charges against Kistruck and former Pilot CFO Colin Simpson for making false or incomplete statements to the Commission as executives of Pilot. Both men were let go from Pilot by parent Aviva Canada last spring, following a restatement of Pilot’s reserves. An actuarial investigation had revealed a $195 million reserve deficiency in 2002 yearend results for Pilot.Kistruck says that while Aviva exercised the termination clause in his contract, he is still receiving compensation as part of the termination agreement. In response to the idea that he was “axed” or fired for cause by the company, he stresses, “it was never like that”.Kistruck is now CEO of Kingsway’s York Fire & Casualty, while Simpson is CFO of the same. Kistruck confirms his new employer’s support (see CU article, May 12, 2004), and says he continues to receive strong support from York’s broker community.However, he says as a publicly-traded company Kingsway will likely have to put some limits on his ability to sign-off financials until the matter is resolved.Kistruck expects he will not learn the full details of the FSCO charges for several months, and adds “I hope it [the case] is resolved over the next few months, not years.”