SEC issues legal notices to Fairfax, RenaissanceRe

The SEC has issued another subpoena to Fairfax Holdings Ltd. and a “Wells Notice” to Bermuda-based reinsurer RenaissanceRe Holdings Ltd. as part of its ongoing investigation into the U.S. insurance industry.<br>
RenaissanceRe (NYSE: RNR) recently confirmed it has received a Wells Notice from the staff of the U.S. Securities and Exchange Commission (SEC) in connection with the commission’s ongoing investigation into the restatement of the Company’s financial statements.<br>
Under SEC procedures, a Wells Notice indicates staff of the SEC will recommend that the commission should bring a civil enforcement action against a company for alleged violations of federal securities laws. <br>
Recipients of Wells Notices have the opportunity to respond to the SEC staff before any formal recommendation is made. <br>
RenaissanceRe says it is “engaged in discussions with the staff of the SEC concerning the possible resolution of these matters.”<br>
The company says it is continuing to cooperate with the SEC and other governmental agencies in their ongoing investigations. “The company is unable to predict the outcome of the investigations or whether its current efforts to resolve them will be successful,” RenaissanceRe said in a statement.<br>
In the meantime, Canadian-based Fairfax Financial Holdings Ltd. received its second subpoena within the past month to supply documents to the SEC.<br>
In early September, Fairfax received a subpoena from U.S. regulators to provide documents on nontraditional insurance products. <br>
Fairfax announced recently it has received “a further subpoena from the [SEC] as part of its investigation into certain loss mitigation products, requesting documents regarding any transactions in securities of Fairfax Financial, the compensation for such transactions and the trading volume or share price of such securities. Fairfax is co-operating with that request.”