ALBERTA INSURANCE COUNCIL
(the “AIC”)
In the Matter of the Insurance Act, R.S.A. 2000 Chapter I-3
(the “Act”)
And
In the Matter of Arney Falconer
(the "Agent")
DECISION
OF
The Life Insurance Council
(the “Council”)
This case involved allegations made pursuant to ss. 480(1)(a) and 509(1)(a) of the Act. Specifically, it is alleged that the Agent misrepresented his eligibility for benefits as a group insured/plan member on enrollment application forms submitted to the Great-West Life Assurance Company (“GWL”), and the Equitable Life Insurance Company of Canada (“Equitable Life”). In so doing, it is alleged that he is guilty of misrepresentation, fraud, deceit, untrustworthiness, or dishonesty as set out in s. 480(1)(a) of the Act. In addition or in the alternative, it is alleged that the Agent made a false or misleading statement or representation and that this violates s. 509(1)(a) of the Act.
Facts and Evidence
This matter proceeded by way of a written Report to Council dated February 11, 2014 (the “Report”). The Report was forwarded to the Agent for his review and to allow the Agent to provide the Council with any further evidence or submissions by way of Addendum. The Agent signed the Report on February 19, 2014 and submitted an Addendum by way of a four-page letter.
The Agent has been licensed as a life and accident & sickness (“A&S”) insurance agent since at least January 1, 1989. On April 30, 2013 the AIC opened an investigation file against the Agent based on the receipt of a verbal concern raised by another insurance agent (“Agent A”).
On May 6, 2013, an AIC investigator spoke with Agent A. In this telephone conversation, Agent A advised the investigator that he purchased a block of group insurance business from the Agent in September of 2010. Subsequently, it came to Agent A’s attention that the Agent was enrolled in a group insurance contract issued by GWL to a car dealership (hereinafter referred to as “the Dealership”). Agent A advised the investigator that he was concerned that the Agent was not eligible for benefits under the group insurance contract. Agent A also told the investigator that he approached GWL about his concerns but they failed to take any action at the time. Agent A stated that he was no longer the servicing agent in relation to the Dealership and that the GWL policy was replaced by an Equitable Life policy sometime in July of 2012. Agent A did not know whether or not the Agent was enrolled as a group insured under the subsequently issued Equitable Life contract. Agent A also noted that he possessed a GWL billing statement that confirmed that the Agent was listed as a group insured under the GWL group insurance contract in April of 2012.
On May 7, 2013, the investigator wrote to an official with Equitable Life to request information and documentation related to the group contract that Equitable Life held for the Dealership. A different Equitable Life official responded by way of email on May 22, 2013. In this email, the Equitable Life official indicated that “… the enrolment form for [the Agent] does not list an occupation but we asked for that missing information and it’s now indicated on the system that he is a ‘Consultant’. [The Agent] is still enrolled on the plan.” This official also provided the AIC with the following documents:
i) A copy of an “Advisor Information and Agreement” for Equitable Life dated July 3, 2012. In section 1 of the agreement, it names [“Agent B”] as the advisor.
ii) A copy of six pages from the 21 page “Application for Group Insurance” between the Dealership and Equitable Life dated June 25, 2012. In section 9, “Eligible Employees” it states, “Please Note: In order to be eligible for coverage under the Group Policy, ‘Eligible Employees’ must be on the Employer’s payroll, and reside and work in Canada on a permanent, non-seasonal, full-time basis. Temporary employees are not eligible for coverage under the Group Policy.”
iii) A copy of the group enrollment application signed by the Agent dated July 3, 2012. In section A, it indicates the Agent’s name in the Plan Member’s Name section and indicates earnings of $25,000. No occupation is indicated in the same section. In the Plan Members Signature section signed by the Agent, it indicates, “I certify that all of the information given on this form is true, correct and complete.”
iv) A copy of relevant pages from the group insurance contract issued to the Dealership. The contract has an effective date of August 1, 2012. Included in the Policy are “Definitions” and “Insuring Provisions” sections including definitions of “actively at work” and “Employee”. Also included is the contractual provision related to “Eligibility”.
On May 24, 2013 the investigator wrote to a GWL official and requested that she provide information and documentation as to the group policy they held for the Dealership. A different GWL official responded by way of a letter and accompanying attachments dated June 6, 2013. In her response, this official wrote that all applications, change forms and correspondence related to the policy were administered and held by the Dealership. Among the attachments, she provided was a copy of a “Plan Outline” which indicated that the plan became effective on April 1, 2003. The Report noted that the Plan Outline contains a provision related to “Employee Eligibility”. This provision indicates that an employee is eligible after 3 months of continuous employment and is considered continuously employed if he meets the actively at work requirement. Actively at work includes the requirement that the employee must be “actually working at the employer’s place of business or a place where the employer’s business requires him to work….”
Further email correspondence passed between the investigator and the second GWL official on June 17, 2013. In these, GWL indicated that it obtained a "group net coverage summary report” from the contract sales representative and that this listed the Agent’s and indicated he earned $25,000.00 annually from the Dealership. She indicated that this document would have been provided to Equitable Life when its contract replaced the GWL contract. On this date, the GWL official also advised the investigator that the Agent paid premiums for the GWL plan effective March 31, 2011 until the plan’s termination date of August 31, 2012.
On August 20, 2013, the investigator had a telephone conversation with the Agent. During this call the investigator advised the Agent of the existence of the complaint and asked the Agent what type of relationship he had with the Dealership. The Agent indicated that he provided “consulting services” to the Dealership related to insurance and financial products. The investigator asked the Agent about the Equitable Life group coverage enrollment application and the statement that he received a salary of $25,000.00 annually. In response, the Agent indicated that the parties’ original intent was that the Dealership was to compensate him but that he ultimately did not receive any earnings from the Dealership.
In response to a request from the investigator, the Agent wrote to the AIC by letter dated September 5, 2013. In this letter, the Agent wrote, among other things, the following:
To outline the relationship between myself, our company and [the Dealership] we have to go back prior to 2002. I have consulted to (sic) [the Dealership] on their grouped benefit coverage's and other insurance related matters, and have brokered their programs through Canadian Automobile Dealers Association program, formerly underwritten by Canada Life, and subsequently Great West Life and subsequently appointed agent of record. Compensation as declared to [the Dealership] was paid in the form of commission to Norwin Management Ltd. Outside the agent-sponsor relationship, I was requested prior to implementing the benefits program through CADA, by [the Dealership] to consult on variety (sic) of insurance or HR matters as required. For that service, it was mutually agreed that I/we (sic) bill for services rendered on a fee for service basis. I elected first as a matter of courtesy, and subsequently because we were being compensated fairly through commissions paid through Great West Life, not to extra bill [the Dealership] for consulting. And to this date we have received no monetary remuneration.
In February 2011 as a thank you, and courtesy for consulting free gratis (sic), [the Dealership] extended the opportunity to participate first in the CADA/GWL dealer program #340617 which I accepted and did.
Then in the spring of 2012 a point where I was no longer the agent of record for the GWL plan, nor associated with any CADA accounts, two agents on behalf of and for Equitable, also customers of [the Dealership] submitted a proposal to switch carriers. As on many occasions, [the Dealership’s] management brought the proposal to me to evaluate and make recommendations. A written summary was submitted detailing deviations and perks offered through the CADA program, but not with Equitable they could elect a plan change and move. In the offer they accepted, Equitable agreed to grandfather all coverage in force and to those enrolled with Great West. In that context in July 2012 I was again extended the opportunity to participate in the benefits program with Equitable Life which I have under policy 812021. I accepted and was enrolled under cert 01000.
For the record, at no time was it represented that I was an employee of [the Dealership]. On the Great West application attached, it was noted I was an HR Specialist, and on the Equitable fact sheet as a consultant.
Furthermore at no time did I personally declare that a salary amount or earnings were at $25000 per annum. This was an arbitrary amount set and established by [the Dealership's] administration for enrollment purposes similar to the figure they assign to new sales personnel that have not established an earnings pattern. When first completing the Great West application form I did note an amount of $2500 [the Agent must have meant to say $25,000] per year. This was the estimated remuneration if in fact a consulting fee for service would be submitted. However for the record, no fees have ever been billed to or compensation paid by [the Dealership] for any consulting.
And again for the record, both Great West Life and Equitable Life management teams were advised of the relationship with [the Dealership], and were fully aware that I was enrolled on the respective benefit plans. And neither challenged the fact. Furthermore, upon receipt of your call and letter I reached out to both providers confirming the foregoing.
In response to your request as to claims submitted: to the best of my recollection, under both the Great West and Equitable plans I have primarily made claims for prescriptions. No other medical claims have been submitted. However, possibly one dental claim may have, but most dental work done has been completed while I have been in the United States and paid directly out of pocket. [The Dealership] has not paid or subsidized premiums as it relates to my enrollment. All premiums for my participation have been defined and have been paid personally by me through a series of post dated [sic] cheques. A copy of a declaration of premiums paid for tax purposes is attached.
In closing I have responded honestly and to the best of my ability. I trust the foregoing is satisfactory. Should you have any further requirements, please do not hesitate to contact me.
By letter dated September 4, 2013, one of the Dealership’s principals wrote the investigator to provide information about the Dealership’s insurance and the Agent. In this letter he wrote:
It has been brought to our attention that an investigation has been initiated in response to a complaint lodged as to the relationship between [the Dealership] and [the Agent], and in particular that [the Agent] is enrolled in [the Dealership's] grouped benefits program
[The Agent] is and has been a customer of the dealership for some time. Going back over ten year he has brokered our grouped benefit coverage's and has been retained to consult and has lent counsel as requested on various insurance and HR matters. That relationship still exists today. Although entitled to fees for services rendered, no remuneration has been requested, nor has any been paid to him personally or to his company.
In February 2011 as a thank you, and as courtesy for services rendered and in anticipation of future requirements, we chose to extend to him the opportunity to participate our [sic] Great West Life/CADA grouped policy. Then in the summer of 2012, when Equitable Life made an offer for our business and agreed to grandfather all benefits to those enrolled under then Great West Life program, the courtesy to participate was again extended to [the Agent]. It needs to be noted that to date no premiums under this arrangement have been paid or subsidized by Lone Star. Each and every month, the cost of the benefits have been borne solely by him and paid with postdated cheques.
With reference to the declared salary on each enrollment application you are questioning, an amount was required by both providers as part of the enrollment process. As no salary had been or would be paid, the dollar figure listed for Mr. Falconer was an arbitrary amount chosen as related to consulting services going forward. The process, common in the automotive industry is similar in the way amounts are assigned for new commissioned sales personnel that do not have a track record at the time they are eligible for coverage.
In closing it should be noted that both Great West and Equitable were and are aware of the working relationship between [the Dealership] and Arney Falconer, along with his enrollment in our benefit programs past and present. Neither provider has raised concerns, nor challenged the arrangement, so our question is why has the complaint been lodged, allegations made, and why the investigation?
In September 2013, GWL advised the investigator that it had discovered documents suggesting that GWL was aware that the Agent was added to the Dealership’s payroll effective March 1, 2011 and what the Agent told them regarding the services he was providing the Dealership. In a series of redacted e-mails between the Agent and GWL (beginning February 9, 2011), the Agent advised GWL that “I have been retained effective March 1st 2010 [the Agent later confirmed he meant 2011] as both a HR and Special Projects consultant for [the Dealership]. I will be providing 25 hours of weekly services to them. As part of the agreement and package, I will be going on their benefits plan.” In subsequent internal e-mails, a GWL employee questioned the situation and referenced the eligibility provision in the Dealership’s contract. It appears that it was GWL’s view that the Agent qualified for coverage. This conclusion was obviously made on the assumption that the information the Agent provided was correct and the eligibility criteria contained in the contract.
On October 9, 2013, an Equitable Life official advised the AIC that Equitable Life terminated the Agent as a plan member from the Dealership’s plan and that they were no longer prepared to accept insurance business from the Agent. Equitable Life also provided an email chain that stated that Equitable Life had no documented record confirming its awareness of the nature of the relationship between the Agent and the Dealership but that one person no longer with Equitable Life may have had some information.
The Agent’s submissions to the Report contained, among other things, the following:
…
In response to the allegations made against me, [the Agent] sited under either Section 480(1)(a) of the Alberta Insurance Act R.S.A. 2000 Chapters 1-3, and amendments thereto, that in reference to two separate "group insurance" contracts did first misrepresent my eligibility for benefits on enrollment application forms submitted to Great -West and Equitable life., and/or under Section 500(1)(a) (sic) made a false or misleading statement or representation in relation to my eligibility for benefits as a group insured/plan member on the same application forms, I plead not guilty to either charge/violation.
As included in the file you have compiled as investigator: I acknowledge and attest to my response letter [Exhibit K] dated September 5,2013 to your letter of August 20, 2013 [Exhibit J], [the Dealership’s] Payroll confirmation referencing part of the monies paid to [the Dealership] for by me also [Exhibit K], the application form to Great West signed and dated 02/14/11 [Exhibit K], my hand written notes, that I did not supply nor complete any part of the computer generate [sic] forms from GWL [Exhibit K], the letter from [one of the Dealership’s principals] to your attention, marked as received Sep 06.2013[Exhibit L], that under [Exhibit C] the enrollment form dated July 17, 2012 I did complete on July 3, 2012 in my own printing, specific portions of the application for coverage under Equitable Life, policy 812021 that pertained to my address, email address, benefits requested, beneficiary designations. Although I signed the application confirming the information I provided, the form came with pre-printed portions, at the direction of [the Dealership's] HR/Payroll, generated by Equitable which I did not provide or represent., and finally under [Exhibit O] a copy of my email dated February 9, 2011 to [a GWL official] openly advising him that I had been retained to consult on HR and Special Projects, that I would be going on their benefits plan. Noting [implied and based on previous files Norwin and GWL had worked on] that it would be necessary to set up a separate class for me in order to be compliant, and requesting that it be initiated and to advise accordingly. I further acknowledge as included in the file, that [a GWL official] in response to my email of February 9, 2011 moved to address my request with his administration and management.
As for the rest of the compiled file sent and received by you and your office at the [AIC] in reference to file 67282, I acknowledge that I have reviewed every aspect of the file and content there in, however I cannot attest or comment as I was not partisan to any aspect of the contracts/policies, or amendments thereto [in particular [the Dealership], Policy 34061] in place with Great West Life/CADA after November 1, 2010, or Policy 812021 implemented by Equitable for Lone Star Inc., or the correspondence generated by the representatives contacted for each provider.
To the allegations, charges and potential violations to which I have replied not guilty, I question the intent and motive by [Agent A] to wait and file the complaint as and when he did. As part of the contract where [Agent A and his agency] purchased through Arney Falconer, Norwin's CADA Block of business plus additional named accounts, in September 2010 consulting was extended as detailed in the contract: "6. Post-Closing Consulting. For one year following the Closing Date, Vendor agrees that Arney Falconer will provide his services to Purchaser on a no cost, uncompensated basis to assist the Purchaser in the retention of the Clients and the Present Group Benefits Business in order to assist Purchaser in facilitating and easing the transition of Clients and insurance carriers after the Closing Date. However, beyond the initial one year period, the consulting provided by Vendor shall be on a fee for service basis negotiated and paid at such time." As such, and pursuant to the agreement from September 2010, I partisan [sic] to and in some cases in receipt of a copy of each renewal from [Agent A] and assisted in the renewal process at some level for each file sold in the Block, including [the Dealership] that year [generated from CADA/GWL January 31 2011]. For the record, in 2011 with my assistance and support [Agent A] was successful in [the Dealership's] renewal. During that time frame and going forward, information was continually being exchanged and shared. And to address the remarks that it came to his attention, it did. In February 2011 I informed him that I had been retained as an HR and Insurance consultant, accorded the opportunity to participate and was going to participate in [the Dealership's] plan. He was also advised in the same conversation that GWL /and one of its officials] had been notified and a special request made to set up a separate class. Moving forward and in 2012 because [the Dealership] was not happy with [Agent A] they entertained the offer on behalf of Equitable. As their retained consultant, I was asked to review the offer and submit a report which I did. They received an honest, unbiased comprehensive analysis and comparison to the then in force CADA/GWL benefits plan. [Agent A] was unhappy with their decision to move and made it known that he felt that I in part was to blame for the move. He then was further frustrated because I was involved when another account displeased his delivery and service, asked for my assistance in their renewal for 2013. He challenged that I was in breach of our agreement, but soon backed off after consulting his counsel and it was determined I in fact was not. In review of the aforementioned, I have now determined his motive but not the timing!
To the allegations that there was misrepresentation I plead not guilty, because I did not make a misrepresentation or any false or misleading statements to either Great West or Equitable. From the time [the Dealership] invited me to participate in their benefits plan, Great West Life and [Agent A] were involved where open, forth right, and on top of the table declarations were made. With Great West, I addressed my involvement and questioned as required from knowledge and experience in the context of precedents set to accommodate similar special working relationships, that over the years I had advised on and been part of, then moved to be enrolled in [the Dealership's] Great West Life Policy. With my enrollment application, every aspect and all declarations made were consistent and did not deviate with those made with and to Great West or its representative. With the Equitable enrollment addressed later in this submission, and because I was requested to review their offer and did, coverage and members were to be grandfathered, on that basis moved to be enrolled with them when requested to do so. But as detailed later questioned the hours declared and salary assigned on their application form. To elaborate: I notified Great West Life first by phone, and then per Exhibit "O" that I had been retained as a consultant and as part of the agreement I will be going on their benefits program. With the projects at hand and at that time, I estimated the hours that would be dedicated to the projects and other matters on a weekly basis. Included in the email of 02.09.11 [Exhibit O], I noted if it would be necessary to set up a separate class please initiate and to advise accordingly. Without elaborating in the email, as previously noted, we had discussed my participation on the phone, and we had concurred that in order to be compliant and not to contravene the current enrollment requirements he would have to go up stairs to get approval for a separate class. Although we did not have a firm answer, we felt that from direct experience working with Great West Life as this was not a first approval would be granted. On previous occasions we had set up separate classes to accommodate "contract workers" or "consultants" [sic] On the basis of our conversation and the confirming email the application form that I completed 02/14/11[Exhibit K] declared and defined that I was being retained as an HR Specialist and that my earnings would be $2500 (sic) per year. So I ask, where is the misrepresentation or false or misleading statement (s)?
Further to the allegations and for the record, Great West Life never notified me that I could not be enrolled, nor did they raise any subsequent objection or request that I withdraw from the plan. And for the record, as I was no longer the servicing agent to this account [the Dealership] as with all others from the Block [position by definition, contractually changed September 2010 and as implemented by Great West Life, November 2010], I was no longer party to any contractual amendments to their contract (s) with CADA/GWL. And in that the then servicing agent [Agent A] and I were in ongoing communication over this account and others no objection was raised by him during that time frame about my participation, I assumed the amendment was made and I was totally compliant. I again state my surprise that [Agent A] did in fact file, waited to file the complaint and make the allegations when he did and question his motive?
To the allegations with reference to my enrollment with the Equitable Life plan, the original offer which I reviewed stated that all members and coverage in force with Great West Life would be grandfathered to the Equitable Life Group Plan. Please be advised that after I made my recommendations to [the Dealership] and they accepted the Equitable Life offer, I was not made party to the contract in any way, to its content nor definitions. So as neither Great West while I was on the CADA/GWL plan, or Equitable through the transferring agents for or their Manager of Group Marketing at Equitable ever challenged my enrollment or stated I was not compliant. I therefore made the assumption, and based on long standing open working relationships, I completed my application accordingly. My enrollment with Equitable followed the enrollment with Great West Life, were consistent in all respects with the fact that no misrepresentation, misleading nor false statement was knowingly or otherwise made to either provider by me except in the context referenced from [the Dealership's] HR/Payroll in the following.
To the allegations that I made a false statement about my earnings on the Equitable Life application [Exhibit C), the amount declared was entered by [the Dealership] and printed by Equitable, not me. I inquired to [the Dealership] and pointed out it was not consistent with my declaration with the Great West Life application, March 2011 or equitable to services previously rendered or that would be going forward. I was told that amount was elected by them, and was a minimum amount for insurance purposes assigned and consistent with members of their sales staff that had not established T4able earnings. Again as I was neither part nor partisan of or to the contract, I went forward as directed. For the record, this practice of assigning an arbitrary salary to neither undefined nor established members of this company is and was common in the automotive industry. Again in the context of how this unfolded, my enrollment with Equitable net of the salary declaration they assigned, not me, and that I was not party to the content or definitions of the their [sic] contract with [the Dealership], I was consistent with procedures and declarations made to and for Great West Life, and in that from the original offer from Equitable declared that all members and coverage were to be grandfathered. I had no reason not to believe classes set up would parallel those at Great West. I again affirm my position that no misrepresentation, misleading nor false statement was knowingly or otherwise made by me.
In closing I have responded honestly and to the best of my ability. I trust the foregoing is satisfactory. Should you have any further requirements, please do not hesitate to contact me.
Discussion
In order to conclude that the Agent has committed an offence pursuant to s. 480(1)(a) of the Act, the Report must prove, on the basis of clear and cogent evidence, that it is more likely than not that the Agent committed the act as alleged. The requirement of clear and cogent evidence reflects the fact that our findings can dramatically impact an insurance agent’s ability to remain in the industry.
Additionally, the elements of s. 480(1)(a) offences have been discussed by the Alberta Court of Queen’s Bench in Roy v. Alberta (Insurance Councils Appeal Board), 2008 ABQB 572 (hereinafter “Roy”). In Roy, the Council found that an Agent committed an offence pursuant to s. 480(1)(a) of the Act when he attested to completing the applicable CE when he did not, in fact, have the required CE. The agent also held a securities license and stated that he believed that the CE he required to maintain his securities license was applicable to his insurance agent requirements. The Insurance Councils Appeal Board also found the agent guilty of an offence and the agent appealed to the Court of Queen’s Bench. In his reasons for judgment, Mr. Justice Marceau reviewed the requisite test to find that an offence pursuant to s. 480(1)(a) of the Act has been made out and expressed it as follows at paragraphs 24 to 26:
[24] The Long case, albeit a charge under the Criminal Code of Canada where the onus of proof is beyond a reasonable doubt (not on a preponderance of evidence as in this case), correctly sets out the two step approach, namely the court or tribunal must first decide whether objectively one or more of the disjunctive elements have been proven. If so, the tribunal should then consider whether the mental element required has been proved. While the Appeal Board said it was applying the Long decision, it did not make a finding as to whether step 1 had been proved with respect to each of the disjunctive elements. Rather it immediately went into a step 2 analysis and found that the mental element required for untrustworthiness might be less than the mental element required for fraud (as a given example).
[25] I am of the view that statement was in error if it was made to convey a sliding scale of mens rea or intent depending on which of the constituent elements was being considered. In my view, the difference between the disjunctive elements may be found in an objective analysis of the definition of each and certainly, as demonstrated by the Long case, what constitutes fraud objectively may be somewhat different from untrustworthiness. However once the objective test has been met, one must turn to the mental element. Here to decide the mental element the Appeal Board was entitled, as it did, to find the mental element was satisfied by the recklessness of the Applicant.
[26] While the language used by the Appeal Board may be characterized as unfortunate, on this review on the motion of the Applicant I need not decide whether the Appeal Board reasonably could acquit the Applicant on four of the disjunctive elements. Rather, the only matter I must decide is whether the Appeal Board acting reasonably could conclude, as they did, that the Applicant’s false answer together with his recklessness justified a finding of "untrustworthiness". (emphasis added)
In applying this test to the case before us, it is clear that the Agent enrolled in and received group benefits from the Dealership. It is equally clear that he signed an application stating that his yearly salary for this occupation was to be $25,000.00 per year. At the same time, the principal of the Dealership wrote that the Agent did not receive any compensation for this “employment” and that it was just the Agent’s and his intention that the enrollment on their group plan was just a “courtesy” or favour for the work that the Agent had previously performed or might perform in the future. In our view, the Agent’s statement on the application was objectively false. He did not receive any salary from the Dealership at that time or any other.
As to the Agent’s intent in all of this, after closely reviewing the evidence, we believe that the Agent and the Dealership developed a scheme to afford the Agent the opportunity to obtain group benefits that in reality had no regard to the true status of the Agent’s employment or consulting relationship with the Dealership. There are a number of different theories proposed by the Agent and the Dealership. Among other things, they say that it was the intention that he was to be paid and then it was not. The benefits were supposed to compensate him for past services and then for services yet to be performed. The reference to annual salary was notional because, like a commissioned salesperson that had yet to sell an automobile, he was not yet paid anything. However, the Dealership and the Agent continued to use this reference when the Equitable plan was put in place and after the Agent was supposedly a consultant for a number of years and there should have been no need for the concept of a “notional” salary.
The Agent states, among other things, that his actions were done with the knowledge and consent of the insurers. This is simply not the case. In his discussions with GWL, he stated that he was providing the Dealership with 25 hours of consulting services per week. Therefore, it is no surprise that they took the position that he met the eligibility criteria. However, nothing in the Agent’s submissions, or those of the Dealership, substantiate that he ever provided hours that amounted to more than half of a normal work week to the “consulting” services (ie. the 25 hours per week he noted to GWL). It is also odd that the Agent took the position that he was not aware of the eligibility provisions of the Equitable contract if he was providing consulting services on the Dealership’s HR and insurance needs. Further, we find it significant that Equitable has since refused to accept any additional business from the Agent. In short, we believe that the Agent made a misrepresentation and acted in an untrustworthy and dishonest manner as set out in s. 480(1)(a) of the Act. Given our conclusions in this regard, we make no findings as to the allegations made pursuant to s. 509 of the Act.
As to the appropriate sanction, we are of the view that the Agent’s actions are serious and warrant a significant penalty. Insurers rely on Agents (and their clients) to provide complete and honest disclosure. While the Agent has no disciplinary history with the AIC, we are of the view that his conduct in this matter cannot be reconciled with continued licensing and we order that his certificates of authority be revoked. We further order that the revocation take place on the 8th day after the mailing of this decision to the Agent.
Therefore, in relation to this finding, we order that the Agent’s certificates of authority be revoked. Pursuant to s. 482 of the Act (copy enclosed), the Agent has thirty (30) days in which to appeal this decision by filing a notice of appeal with the Office of the Superintendent of Insurance.
This Decision was made by way of a motion made and carried at a properly conducted meeting of the Life Insurance Council. The motion was duly recorded in the minutes of that meeting.
Date:_____May 7, 2014_____________
__________Original signed by________
Kenneth Doll, Chair
Life Insurance Council
Extract from the Insurance Act, Chapter I-3
Appeal
482 A decision of the Minister under this Part to refuse to issue, renew or reinstate a certificate of authority, to impose terms and conditions on a certificate of authority, to revoke or suspend a certificate of authority or to impose a penalty on the holder or former holder of a certificate of authority may be appealed in accordance with the regulations.
Extract from the Insurance Councils Regulation, Alberta Regulation 126/2001
Notice of appeal
16(1) A person who is adversely affected by a decision of a council may appeal the decision by submitting a notice of appeal to the Superintendent within 30 days after the council has mailed the written notice of the decision to the person.
(2) The notice of appeal must contain the following:
a) a copy of the written notice of the decision being appealed;
b) a description of the relief requested by the appellant;
c) the signature of the appellant or the appellant's lawyer;
d) an address for service in Alberta for the appellant;
e) an appeal fee of $200 payable to the Provincial Treasurer.
(3) The Superintendent must notify the Minister and provide a copy of the notice of appeal to the council whose decision is being appealed when a notice of appeal has been submitted.
(4) If the appeal involves a suspension or revocation of a certificate of authority or a levy of a penalty, the council's decision is suspended until after the disposition of the appeal by a panel of the Appeal Board.
Address for Superintendent of Insurance:
Superintendent of Insurance
Alberta Finance
402 Terrace Building
9515-107 Street
Edmonton, Alberta T5K 2C3