Arrests in insurance fraud probe

It is reported that the fraud allegations related to the Pru's head office

City of London police have made of number of arrests in connection with allegations of fraud at a major insurance firm, believed to be the Prudential.

The arrests were in connection with fraud at the insurance company's head office, the Daily Telegraph reported.

A spokesman for the insurer told the newspaper: "The Pru has reported a matter relating to procurement procedures and the police are investigating but we cannot comment further."

The insurer refused to indicate to the paper how much money was involved.

A police spokesman said: "I can confirm there have been several arrests in recent weeks in connection with conspiracy to defraud a major insurance company."

Record sales

The news comes the day after the UK life insurance and pensions group Prudential said that its exposure to the 11 September US terror attacks was likely to be less than £1m, revealed that it was on course for record insurance and investment sales this year.

The Pru reported that it sold insurance and investment products worth £15.1bn ($22bn) during the first nine months of 2001 representing a 54% rise in sales.

But Prudential warned that the growth rate would be tough to maintain once the global economic weakness begins to have a serious impact on Asia's economies.