Michael Bright, the former chief executive of Independent Insurance, broke down in the witness box yesterday as he described the financial mess surrounding the collapsed insurer as like a “dark pit” and admitted he had been “hell on earth” to work for.

Mr Bright conceded that his management style had been “overbearing” and that he had been the classic nightmare boss. Of his fellow management team, he admitted: “I know I drove them mad, I drove myself mad.”

Mr Bright, the former head of a £1 billion stock market darling, firmly denied allegations that he had covered up problems at the insurer.

Independent, founded in 1986 by Mr Bright, collapsed in 2001 with the loss of more than 1,000 jobs.

Thousands of individual policyhold-ers were left without cover. The Financial Services Authority paid out more than £350 million in settlement claims.

Appearing at Southwark Crown Court yesterday, Mr Bright said: “Every time we turned something over, something nasty, black and crawly would crawl out and that happened over a number of years.”

He was speaking as the defence began its case in one of the biggest fraud claims in British corporate history.

Mr Bright, along with Philip Condon, the former managing director, and Dennis Lomas, the former finance director, have pleaded not guilty on two counts of conspiracy to defraud and one of fraudulent trading. They stand accused of lying to customers, shareholders and creditors about Independent’s true financial state.

Mr Bright, who declared himself bankrupt and moved to Spain, was first charged in 2005. His departure to Marbella was controversial due to his estimated £3 million pension pot and his wife’s part-ownership of UK assets.

The Serious Fraud Office believes the case could last until December.

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