Fed: Convicted HIH personnel should go to jail - Costello

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Fed: Convicted HIH personnel should go to jail - Costello

CANBERRA, April 17 AAP - Key people involved in the collapse of HIH Insurance shouldgo to jail if convicted of a criminal offence, Treasurer Peter Costello said today.

A royal commission into Australia's biggest corporate disaster yesterday found mismanagementand a failure to put aside money for claims led to the $5.3 billion collapse of HIH Insurance.

The commission report also identified 56 possible breaches of the law that had beenreferred to either the Australian Securities and Investments Commission (ASIC) or theNSW Director of Public Prosecutions.

"All of the evidence will be put before the courts and, if the courts convict somebodyof a criminal offence, yes, I believe it would be appropriate for a jail term to be imposed,"

Mr Costello told ABC Radio.

He said it depended on what was proven before the courts as to whether anyone went to jail.

"I can't say in advance what the court is going to find, you understand that, for legal reasons.

"But I can pledge to investors and policy-holders alike that the investigative bodieswill be full funded to get all of the evidence and we will be asking the prosecutors toaggressively prosecute in the courts.

"If the courts find people guilty, yes, it would be appropriate for them to go to jail."

Mr Costello defended the industry regulator, APRA's, move from Canberra to Sydney,saying it was a positive thing.

"Sydney was the scene of the crime. You're actually moving the regulator to the sitewhere most of the insurance companies were located."

He said APRA was created with all-party support but the government would act on commissionfindings that APRA was inadequate by dismissing its board and replacing it with an executivecommission.

"We are going to expect it to be more aggressive in the future."

AAP dep/gl/bwl

KEYWORD: HIH COSTELLO DAYLEAD