Michael Bright, the founder and former chief executive of Independent Insurance, was behind bars last night after a jury found him guilty of conspiracy to defraud.

Together with Dennis Lomas, his former finance director, and Philip Condon, deputy managing director, Bright was convicted of turning what was once the UK’s largest insurance company into a collapsed business “riddled with fraud”.

The three, who protested their innocence throughout a 19-week trial at Southwark Crown Court, face up to ten years in jail and the confiscation of any remaining assets.

Bright and Lomas were each convicted of two counts of conspiracy to defraud, while Lomas was convicted of one count and acquitted on another.

Judge Geoffrey Rivlin, QC, remanded all three in custody yesterday afternoon after jurors returned after nine days of considering evidence.

None of the three is likely to face the maximum ten-year sentence because of their ages, the length of the investigation and trial, and the fact that their reputations have been ruined.

Bright’s barrister, Ian Winter, QC, said his client, who will be sentenced with his codefendants later this morning, was a broken man whose life was in tatters.

Bright, 53, who founded Independent in 1986, broke down in tears as he told the jury he had been hell on earth to work for and described the financial mess surrounding Independent as a dark pit.

Bright, who at one point almost collapsed during cross-examination, told the jury he was unaware of Independent’s true financial situation and consistently blamed its difficulties on more junior members of staff.

Yesterday his lawyer said he was truly sorry and wished to apologise to each and every person who lost money from Independent’s collapse.

All three men were found guilty of conspiracy to defraud by dishonestly withholding claims data from the insurer’s actuaries Watson Wyatt.

The jury decided that, over the years, figures were deliberately manipulated, undisclosed liabilities buried and bad contracts concealed.

Independent, worth £1 billion in 2000, collapsed in scandal the following year with the loss of more than 1,000 jobs.

Huge numbers of private and business customers were left without cover as the case sent shockwaves throughout the insurance industry. The Financial Services Authority has since paid out more than £350 million in compensation.

The Serious Fraud Office has already applied for a confiscation order over the three men’s remaining assets. Prosecutors will need to convince a judge at a later hearing that the defendants directly profited from the fraud and that they have realisable assets to seize.

Bright, who lost £55 million when his Independent shares became worthless, declared himself bankrupt in June 2001.

The convictions are a significant victory for the SFO, which spent more than two years probing financial irregularities at Independent.

Times Recommends

• Minister in talks with Saudis to protect creditors
• Premier Inn hits back in £29-a-room row
• Bankers hit back at 'populist' bonus supertax