The Financial Services Regulatory Authority of Ontario has refused to renew the life insurance and accident & sickness insurance agent’s license and the corporate insurance agent’s licenses for Michael Lampel and his firm, IFC Financial Inc., operating as Insurance for Children. Additionally, Lampel was fined $55,000.

The fines were levied after Lampel was found to have ordered unlicensed personnel to do his work and it was also found that he ordered them to change the heights and weights of the children the firm was attempting to secure coverage for.

FSRA issued the notice of proposal to refuse to renew licenses and impose the administrative penalties in December 2023 after receiving a life agent reporting form (LARF) from Faith Life Financial. Lampel and IFC requested a hearing before the Financial Services Tribunal in January 2024.

“Following a contested hearing, the tribunal found that Lampel and IFC were not suitable to be licensed,” FSRA states in an announcement about the hearing’s outcome. “The tribunal concluded that this conduct demonstrates a pattern of dishonesty, compromised consumer protection and undermined confidence in the insurance sector. The tribunal also determined that administrative penalties were appropriate because Lampel’s actions were intentional, repeated and directly undermined the consumer protection purpose of the (Insurance) Act,” they add.

First licensed in June 2007, Lampel was contracted to sell for Faith Life, now known as Serenia Life in March 2020. He did not disclose that he had a relationship with the insurer in his license renewal application in one instance. He also failed to disclose the investigation into his conduct on renewal applications for himself and IFC both, submitted on other occasions.

Life insurance and accident and sickness insurance agent, Leslie Gottlieb (LG), worked for IFC between February and November 2021. Lampel’s assistant, meanwhile, identified only as SL, worked as an office assistant at the firm from March until November that same year.

Gottlieb reported Lampel to Faith Life. The insurer treated the allegations as whistleblower allegations under its internal whistleblowing program. 

Insurer terminated contract 

Faith Life terminated Lampel’s contract and sent FSRA the reporting form in March 2022. 

“LG advised that her role was to meet with prospective clients that were scheduled for her by IFC. Lampel instructed LG to meet with clients to sell Faith Life insurance products. After each meeting LG would send a completed word document provided by Lampel that mirrored the Faith Life application to SL, Lampel’s (unlicensed) assistant. SL would then submit the applications to Faith Life using Lampel’s Faith Life access code and Faith Life’s application system,” the notice of proposal in the case states. “LG advised that Lampel did not have contact with the clients throughout the sale process. Despite this, Lampel was placed as the selling and advising agent on all applications when submitted to Faith Life.” 

During the time she worked for the firm, Gottlieb completed 74 applications. The agent made a successful complaint against IFC to the Ministry of Labour to collect unpaid compensation. Lampel sued Gottlieb and Gottlieb counterclaimed. She also reported him to more than one insurer and to the police.

In July 2023, in an interview with FSRA’s investigator, “Lampel indicated that he wanted to ensure that all the policies would remain with IFC, even if the advisor left the company. Lampel stated that he wanted to maintain possession and control of his IFC clients by keeping LG off record and placing himself as the sole selling and advising agent.” (This, according to FSRA’s notice of proposal.) 

Instructed to alter the heights and weights of children 

During the course of the investigation, thanks to Gottlieb’s testimony and Faith Life’s four-month investigation, it was also found that Lampel on several occasions instructed SL to alter the heights and weights of the children being insured before the applications were sent in for consideration.

During the tribunal’s examination of witnesses, a Faith Life representative testified that if the company had known the correct data it would either have refused to issue a policy or offered it at a higher price. Faith Life ultimately decided to honour the policies, a measure the tribunal found “commendable.” 

“Lampel was indignant that Faith Life would honour policies placed based on misleading statements, but he completely failed to appreciate that Faith Life was protecting clients who were not the source of the misleading information,” the tribunal’s reasons for decision states.

Whistleblower’s testimony found to be credible 

“Lampel’s arguments in (his) defence were primarily centred on the credibility of the whistleblower and her alleged improper motives. “We have found the whistleblower’s allegations to be credible, well-supported by independent evidence and uncontradicted by other evidence,” the tribunal’s reasons state. They also noted that Gottlieb’s testimony was also uncontested by any other witnesses.  

When Lampel’s arguments that Gottlieb and Faith Life were part of a conspiracy and that the evidence against him was unverified heresy both failed, Lampel then tried to have the hearing re-opened, based on a complaint he made to the police about Gottlieb following her testimony – a police complaint based on materials which he himself produced during the hearing.

“In our view, Lampel is trying to augment his credibility arguments from the hearing by creating a new situation based on the same story,” the tribunal’s reasons conclude. “There is no basis for re-opening this hearing.” 

The document concludes saying that the tribunal finds it troubling that Lampel reported the witness to police. “Given the timing of Lampel’s complaint to the police, it appears that his complaint may have been retaliation against Gottlieb because of her testimony.”