The Insurance Council of British Columbia has suspended two agents and levied fines against them for unethically profiting from commissions receivedaut from the council when they regularly processed one-year vehicle insurance policies for automobile dealerships engaged in the export of vehicles, before cancelling the policies days later.
The Council adds in one intended decision that experts commissioned to identify money laundering concluded that the agents had facilitated grey market transactions involving the export of luxury vehicles.
According to the two orders issued by the Council, Anthony Bryan Chua Cua is suspended for one year and Ting En (Brian) Lin is suspended for six months, after admitting they processed transactions for the coverage dealers require when selling a new vehicle, for exporters interested in exporting the vehicles to China. The exporters would use temporary owners who would purchase the new vehicles before transferring the vehicles to the exporter. Once the vehicles were transferred, the insurance coverage would be cancelled.
Several license plates stored under desk
The scheme was discovered after an agency nominee noticed several license plates stored under Cua’s desk, some of which were still in their original plastic wrappings. A preliminary investigation found the agents had been issuing one-year Autoplan insurance policies that were being cancelled within days. The Council was notified about the matter in December 2017.
During the course of its investigation, Lin told investigators that he had performed approximately 20-30 transactions for exporters while employed at one agency and another ten transactions for exporters when he moved to another agency after being fired by the first.
Processed at least 129 transactions for exporter
In Cua’s intended decision, meanwhile, the Council says documents indicate that he processed at least 129 transactions for the exporter in 2017 and 2018. Cua also admitted to also serving as a temporary owner on two occasions, purchasing new vehicles from different dealerships in 2017 using funds provided by the exporter. Lin, meanwhile, served as a temporary owner on three occasions, receiving $350 from the exporter, through Cua, on at least one occasion.
During the investigations, Lin said part of his motivation for processing the transactions was that the practice was widespread. “He said that he assumed, since many other agents were processing transactions for exporters, that there must not be an issue. The licensee stated that processing such transactions was extremely common in the industry,” the Council writes in its intended decision. When asked similar questions about how widespread the practice is, Cua told investigators that he had no knowledge about whether or not the activity was common.
In addition to their suspensions, Cua must pay a fine of $7,000, plus $1,925 in costs. Following his one-year suspension, Cua’s license will also be downgraded to a level 1 license for a period of one year. Lin, meanwhile, will pay a fine of $5,000, plus costs totalling $1,562.50. In addition to suspending both his general and life insurance licenses for six months, the council says it will also downgrade his general license for a period of one year and additionally require that he be supervised for one year once his license is reinstated.
