Prize-motivated agent caught insuring clients without their consent

The Financial Services Regulatory Authority of Ontario (FSRA) has revoked the life insurance and accident & sickness insurance agent’s license of Daniel Lath and imposed two administrative penalties, after an insurer discovered Lath taking out policies on clients without their consent to meet sales targets.

Broken down, the two administrative penalties were $10,000 for making false or misleading representations in the solicitation and registration of insurance and $5,000 for providing the regulator with false information on his license renewal about continuing education (CE) that he did not complete. 

Licensed since March 2017, Lath was terminated by his managing general agency (MGA), World Financial Group (WFG) in April 2023 after Foresters submitted a life agent misconduct report (LAMR) to the regulator. The LAMR reported that Lath submitted 16 client applications to the insurer between August 2022 and February 2023 without client’s consent, using two of his own bank accounts to fund the policy premiums.

Paid $10,157 in monthly premiums 

“During this period, Lath contacted some of the clients by email to ask if he could open policies for them in order to win a prize. He indicated in at least one email that he would personally pay for the policies,” the FSRA notice of proposal in the case states. “All 16 applications were for the same insurance product. One application was declined, but 15 policies were issued. For the 15 policies issued, Lath was paying $10,157 in monthly premiums from his own bank accounts.” 

Foresters paid WFG $95,526 in commissions for the 15 issued policies. All of the policies were terminated in February 2023. When compliance officers spoke with three of the insured clients, each were unaware of the policies issued in their names.

“Lath created harm to an insurer and potential harm to consumers. Foresters’ paid commissions of over $95,000 on policies sold, believing that real consumers had been provided with insurance services. Consumers had their personal information leveraged by Lath without their permission,” the notice of proposal concludes, adding that when he was approached by WFG and Foresters about his conduct, he attempted to cover it up rather than mitigate the harm. “He also misled FSRA when asked about the policies,” they write. “Based on Lath’s conduct, the director has reasonable grounds to believe that he is not suitable to be licensed.”