ROYAL Liver has sacked its finance director for “serious breaches of his duties”, claiming he made payments unauthorised by the company.

The mutual insurer last night confirmed it had dismissed George McGregor for sanctioning the payments and allegedly entering into contracts with a third party that were “to the disadvantage of the society”.

Royal Liver says it will now pursue legal action to recover money from firms it says were wrongfully paid, and will challenge the contracts in question.

The dismissal comes at a turbulent time for loss-making Royal Liver, which is in takeover talks with larger rival Royal London as it battles for its survival.

Mr McGregor, 50, who was suspended in November after an internal audit discovered the alleged payments, last night declined to comment on his dismissal when contacted by the Daily Post.

Royal Liver, which is based in Liverpool’s iconic Royal Liver Building, would not comment on how much money is involved.

Its interim chief executive Bill Connolly wrote to Royal Liver’s 200 delegates – the group’s own “members of Parliament”, elected by policyholders to scrutinise the company – to tell them about Mr McGregor’s dismissal. In the letter – seen by the Daily Post – Mr Connolly said he would also talk to takeover bidder Royal London about the case.

In a statement last December, Royal Liver said Mr McGregor was “on extended leave due to personal circumstances”.

Last night, a Royal Liver spokeswoman said: “Following early detection by the society’s normal internal audit plan in late 2009, it was brought to the attention of the committee of management that George McGregor may have made unauthorised payments and entered into alleged contracts to the disadvantage of the society.

“The board promptly sought legal advice and it was decided to put Mr McGregor on extended leave, the objective of which was to achieve his co-operation whilst more information was gathered.

“It is now clear that Mr McGregor failed to follow the society’s risk management and procedural processes and breached his duties in sanctioning payments and entering into alleged commercial arrangements with a third party.