Manulife, TTC reach undisclosed settlement in benefits fraud caseBy The IJ Staff | November 13 2019 11:45AM
After being sued by the Toronto Transit Commission (TTC), Manulife Financial and the TTC this morning announced that the two companies have reached a settlement related to the Healthy Fit case that saw more than 200 TTC employees terminated for benefits fraud.
Terms of the settlement were not disclosed. According to news reports, the TTC had been seeking up to $5-million in reimbursement and damages.
In 2018 when the TTC announced that it was suing Manulife, the TTC alleged that the insurer did not have appropriate fraud management controls or systems in place to detect and analyze trends or patterns that might indicate fraud or abuse – allegations that the insurer denies.
According to news reports, 223 TTC employees were dismissed, resigned or allowed to take early retirement to avoid dismissal after receiving a tip that health care product and service provider, Healthy Fit, was issuing inflated receipts for services that were never provided. As part of the scheme, employees would then submit the falsified claims, collect payments and share the proceeds with Healthy Fit. Adam Smith, the proprietor of Healthy Fit has since plead guilty to two counts of fraud over $5,000, and has been sentenced to two years in prison.