A single mother of two children pleaded with the Financial Services Tribunal (FST) for her debarment to be lifted, saying it would be extremely difficult for her to find employment outside the financial services industry.
The applicant, “SP”, was dismissed and subsequently debarred by OUTsurance after finding her guilty of creating fictitious insurance policies to boost her remuneration.
In her reconsideration application, SP did not dispute the guilty finding but said the FSP had not followed a fair debarment procedure. She also pleaded for leniency because of her personal circumstances and because she was a first-time offender.
SP was employed by OUTsurance as a commercial insurance agent in March 2019. She was paid a fixed monthly retainer for the first four months her employment. Subsequently, her performance was reviewed every six months. If the premiums she generated were below the set targets, her retainer would be reduced.
In September last year, an annual compliance audit found that SP submitted fictitious policy applications to prove to her head of department that she had sold sufficient policies to justify a higher retainer.
While OUTsurance’s internal investigators were in the process of compiling evidence to charge her and refer the matter to internal disciplinary inquiry, they received an email from a client querying a payment. Upon investigation, it was discovered that SP defrauded the client of about R270 000 by falsifying an OUTsurance document. She replaced the insurer’s bank account with her own so that the client paid the premiums to her.
SP resigned with immediate effect on 27 September after she was notified of her suspension and that a disciplinary inquiry would be held.
SP was sent a “termination of employment agreement” that invited her to make representations as to why she should not be debarred because she no longer complied with the Fit and Proper Requirements of honesty and integrity.
SP submitted her representations on 4 October 2023. She admitted that what she had done was of a “very serious nature”, and she did “at some stage pose a risk to the company and the clients”. SP said her conduct was the result of her “struggling severely” with a combination of mental health, physical health, personal, and financial issues.
OUTsurance debarred SP on 6 October.
She applied to the FST for her debarment to be suspended, pending the reconsideration hearing, and for her debarment to be lifted.
She said OUTsurance had notified her of her debarment on 2 October, before allowing her to represent herself at a hearing or considering her submissions as to why she should not be debarred.
OUTsurance admitted it had notified SP of her debarment on 2 October, but it said this notification was sent by mistake. The FSP said the debarment decision was taken on 6 October.
SP also told the Tribunal she had found another FSP that was willing to employ her, but she could not accept the position because of her debarment.
She further submitted: “I am a single mother of two children, aged 11 and 3, and I am solely responsible for them financially. I cannot provide for them if I am unemployed, and with the employment rate being so high, it will prove extremely difficult to find employment in a completely new industry. I have spent 14 years studying and gaining experience and knowledge in the financial services industry. This is all I know. This is my first transgression of such a nature, and I feel that the implications are harsh.”
In an affidavit, SP said: “I am requesting this debarment to be suspended for the reason that we are all human and all make mistakes and learn from them.”
In an affidavit in support of her suspension application, she said: “I am truly remorseful and genuinely apologetic for what has transpired and my actions, and I can assure you that nothing of this nature would ever occur again. I am pleading for a chance to start off on a clean slate at an alternative FSP and would appreciate the opportunity to do so.”
In its opposing affidavit, OUTsurance presented evidence of other transgressions it alleged SP committed while in the insurer’s employ. The alleged transgressions ranged from fraud to allegations by one of SP’s subordinates that she got the broker involved with a loan-shark business. OUTsurance presented a transcription of a telephone conversation in which SP confesses to having defrauded one of the insurer’s customers of about R270 000.
During the Tribunal hearing, SP confirmed that she did not deny the findings that resulted in her debarment. But she pleaded for clemency based on her personal circumstances as a single mother, and because she did not have another career.
The Tribunal found that SP’s conduct in providing the client with her bank account details to be used in depositing the premiums was fraudulent and dishonest. It agreed with OUTsurance that SP no longer complied with the Fit and Proper Requirements of honesty and integrity.
The FST dismissed the reconsideration application.
I was debarred by Clientèle in 2023 on the 15th of March for unfair reasons as they allegedly say I sold a client a policy without his consent, how possible is that because all calls were recorded and permission was granted by the client. As we speak I am unemployed and have more than 10 years of insurance experience but no company is willing to hire me as I do declare to them at the interview stage that I was debarred, it’s very sad and heart braking as I was the sole bread winner. INSURANCE is all I know.
Hi there,
Have you considered approaching the FSCA to have your debarment uplifted? The 12 month waiting period would have lapsed by now. Maybe consider applying.
Ii have been debarred by metropolitan in 2018 till now and to come out on that and make me sad when I have to get job and my case they say to me I have write a policy without a policy holder knowledge and what suprice me where a get a person I’d number,adress and other things
I have been a KI of two FSPs for over 15 years. For many years I gave a second chance to reps who I should have debarred. Not anymore and I regret doing that.
In one instance, I forgave a you man who went to lengths of bribing the clients that he had defrauded to withdraw fraud allegations. The young man pleaded with me to forgive him because it’s the devil who mislead him but he had seen the light and accepted Jesus as his savour. I forgave him and before firing him, I made him sign an undertaking that should I hear that he is involved in fraudulent activities I wouldn’t hesitate to provide the undertaking to the affected parties. Fast forward. The young man later managed to register his own FSP and went ahead to defraud an insurer more than 6 million.
In the second incident I helped a single mother rep who was debarred by an insurer to have her debarment lifted after she convinced me that the insurer was biased. I offered her a job and she defrauded us over 250k.
Trust me, a rotten egg is a rotten egg.