In an unusual case involving three different formerly licensed insurance advisors, the Financial Services Regulatory Authority of Ontario (FSRA) has imposed administrative penalties ranging from $15,000 to $55,000 on Jay Sanjay Patel, Nirali Chandrakant Patel and Pratik Gohel.
The former insurance agents, FSRA states, “were licensed insurance agents who used international students in financial need to generate fraudulent insurance business. The agents lured students by advertising non-existent employment opportunities, targeting students who needed income to meet their expenses in Canada.”
They add that the agents misused personal information to apply for insurance policies, often without the student’s knowledge, and claimed that purchasing a life insurance policy was a mandatory condition for employment. “The agents made no effort to ascertain if the insurance policies were suited to the needs of the students who had no stable income and were living temporarily in Canada under study permits.”
According to FSRA, Jay Patel admits he breached the Insurance Act by offering to pay life insurance premiums for international students as a way of generating additional business and that he pressured international students to purchase insurance contracts, misleading both the students and the insurance companies the group was contracted with. Nirali Patel admitted to pressuring international students and making misleading statements, and Gohel admitted to making misleading statements.
Jay Patel became licensed as a life insurance accident and sickness agent on March 3, 2019. His license expired March 2021. Nirali Patel was similarly licensed from March 2019 until March 2020, and Gogel became licensed in October 2019, with his own license expiring October 2021.
FSRA’s penalties included administrative penalties in the amount of $55,000 imposed on Jay Patel, $35,000, imposed on Nirali Patel, and $15,000 imposed on Gohel.
During the relevant time, the three agents were contracted with the World Financial Group of Canada Inc., a managing general agency (MGA) operating in Ontario. As part of their contract with the MGA, the team acted as agents for the Canada Protection Plan (CPP) and contracted as insurance agents with ivari.
In December 2019 Jay Patel incorporated Expedite Group of Companies Ltd, an employment agency.
“Expedite was essentially a front used by the agents to generate fraudulent insurance business by targeting international students in financial need,” FSRA states in its minutes of settlement. Jay Patel changed the firm’s name to Ideal Solutions Canada Inc. in July 2020. Patel admitted this name change was due to complaints and investigations into his insurance agent activities. The firm was dissolved November 8, 2021.
