The Life Insurance Council of Manitoba has fined the Me-Dian Credit Union of Manitoba $10,000 and assessed costs of $3,000 – double what it originally assessed in its intended decision – after the credit union failed to inform the regulator about the departure of its designated official and failed to renew its license, conducting business for more than six months while unlicensed.
Although the council originally assessed investigation costs of $1,500, these were increased after the credit union requested a show cause hearing to demonstrate to council that it should reverse or revise its intended decision.
“During the course of the show cause hearing, council continued to be concerned regarding the licensee’s representatives’ understanding of their obligations as the license holder. The person who initially signed as the proposed designated official in applications had no knowledge of the responsibilities of a designated official and stated that it was not he, but someone else who would in fact be assuming the associated responsibility. The person who said he would now be proposed as the designated official in the new forthcoming application also acknowledged that he had little knowledge of what the responsibility entailed,” the insurance council writes in its decision.
“For all of these reasons, council rejected the submission of the licensee that the penalty specified in the intended decision should be reduced. Indeed, in the circumstances, there appeared to be no reasonable basis for seeking a show cause hearing. The hearing only served to magnify the seriousness of council’s concerns and to demonstrate forcefully that a significant penalty must be imposed.”
