IN THE MATTER OF the Insurance Act, R.S.O. 1990, c.I.8, as amended (the “Act”), in particular sections 392.4, 407.1, 441.2 and 441.3;

AND IN THE MATTER OF Noella Caspersz.

NOTICE OF PROPOSAL TO REFUSE TO RENEW LICENCE
AND TO IMPOSE ADMINISTRATIVE PENALTIES

TO: Noella Caspersz

TAKE NOTICE THAT pursuant to sections 392.4 and 407.1 of the Act, and by delegated authority from the Chief Executive Officer of the Financial Services Regulatory Authority of Ontario (the “Chief Executive Officer”), the Director, Litigation and Enforcement, (the “Director”) is proposing to refuse to renew the life insurance and accident and sickness insurance agent licence issued to Noella Caspersz (“Caspersz”).

AND TAKE NOTICE THAT pursuant to section 441.3 of the Act, and by delegated authority from the Chief Executive Officer, the Director is proposing to impose two administrative penalties in the total amount of $40,000 on Caspersz as follows:

an administrative penalty of $30,000 for repeatedly directly or indirectly paying or allowing compensation to be paid to a non-licensee contrary to section 403 of the Act; and
an administrative penalty of $10,000 for providing false or misleading information to the Chief Executive Officer contrary to section 447(2)(a) of the Act.

Details of these contraventions and reasons for this proposal are described below. This Notice of Proposal includes allegations that may be considered at a hearing.

SI VOUS DÉSIREZ RECEVOIR CET AVIS EN FRANÇAIS, veuillez nous envoyer votre demande par courriel immédiatement à : contactcentre@fsrao.ca.

YOU ARE ENTITLED TO A HEARING BY THE FINANCIAL SERVICES TRIBUNAL (THE “TRIBUNAL”) PURSUANT TO SECTIONS 407.1(2), 407.1(3), 441.3(2) AND 441.3(5) OF THE ACT. A hearing by the Tribunal about this Notice of Proposal may be requested by completing the enclosed Request for Hearing Form (Form 1) and delivering it to the Tribunal within fifteen (15) days after this Notice of Proposal is received by you. The Request for Hearing Form (Form 1) must be mailed, delivered, faxed or emailed to:

Address:
Financial Services Tribunal
25 Sheppard Avenue W, Suite 100
Toronto, ON M2N 6S6

Attention : Registrar

Fax: 416-226-7750

Email: contact@fstontario.ca

For additional copies of the Request for Hearing Form (Form 1), visit the Tribunal’s website at www.fstontario.ca.

TAKE NOTICE THAT if you do not deliver a written request for a hearing to the Tribunal within fifteen (15) days after this Notice of Proposal is received by you, orders will be issued as described in this Notice of Proposal. TAKE FURTHER NOTICE of the payment requirements in section 5 of Ontario Regulation 408/12, which state that the penalized person or entity shall pay the penalty no later than thirty (30) days after the person or entity is given notice of the order imposing the penalty, after the matter is finally determined if a hearing is requested, or such longer time as may be specified in the order.

The hearing before the Tribunal will proceed in accordance with the Rules of Practice and Procedure for Proceedings before the Financial Services Tribunal (“Rules”) made under the authority of the Statutory Powers Procedure Act, R.S.O. 1990, c. S.22, as amended. The Rules are available at the website of the Tribunal: www.fstontario.ca. Alternatively, a copy can be obtained by telephoning the Registrar of the Tribunal at (416) 590-7294 or toll free at 1-800-668-0128 extension 7294.

At a hearing, your character, conduct and/or competence may be in issue. You may be furnished with further and/or other particulars, including further or other grounds, to support this proposal.

REASONS FOR PROPOSAL

I. INTRODUCTION

These are the reasons of the Director to refuse to renew Caspersz’s life insurance and accident and sickness insurance agent licence and to impose administrative penalties on Caspersz.
On August 11, 2023, the Director issued another Notice of Proposal to Refuse to Renew Caspersz’s life insurance licence and to impose an administrative penalty of $50,000 for Caspersz’s failure to respond promptly, explicitly, and completely to inquiries by the Financial Services Regulatory Authority of Ontario (“FSRA”) (the “2023 NOP”).
Following the issuance of the 2023 NOP, Caspersz responded to the inquiry letter and participated in an interview. FSRA now seeks a reduced administrative penalty of $10,000 for the failure to respond set out in the 2023 NOP.
This Notice of Proposal is in respect of additional contraventions of the Act by Caspersz and further reasons for her unsuitability to be licensed.

II. BACKGROUND

Caspersz was a licensed life insurance and accident & sickness insurance agent (licence # 94027106) under the Act. Caspersz was first licensed in 1983.
Caspersz applied to renew her licence on July 14, 2023. Her licence expired on August 4, 2023.
Caspersz was previously contracted to sell for Canada Life Assurance Company (“Canada Life”). Canada Life terminated their contract with Caspersz on February 16, 2023.
DT was a licensed life insurance and accident & sickness insurance agent under the Act. DT’s licence expired on February 7, 2019. DT has been the subject of two Notices of Proposal issued by the Director, dated January 25, 2023, and April 24, 2023.
On February 24, 2023, Canada Life submitted a letter and a Life Agent Reporting Form (“LARF”) to FSRA regarding a “business relationship” between DT and Caspersz.

III. FACTS

A. Previous Compliance History

In January 2009, Caspersz’s licence was suspended for a period of 30 days by the Financial Services Commission of Ontario (“FSCO”). FSCO is the predecessor organization of FSRA.
The suspension was pursuant to a Minutes of Settlement (“MOS”) entered into in November 2008 between Caspersz and FSCO. In the MOS, Caspersz admitted that, between 2001 and 2004, another licensed agent wrote at least 10 insurance applications and, without advising the clients, named Caspersz as the servicing agent. Caspersz signed the applications purporting to be the servicing agent.

B. Caspersz’s Relationship with DT and Clients

In 2021 and 2022, Caspersz received $60,049.23 in commissions on policies related to 16 clients referred to her by DT. In return, Caspersz paid DT a portion of the commissions she received for the clients. Less the commissions she paid DT, she profited $45,234.23.
In April 2024, a FSRA Investigator spoke with two former clients of Caspersz. Both clients were referred to Caspersz by DT. Neither had ever met Caspersz, and one had rarely communicated with her. Both clients continued to meet with DT for advice about which segregated funds to choose, while Caspersz completed and submitted the required insurance forms.

C. Payments Disguised as Training

Caspersz and DT entered into an “agreement in principle” in August 2019 (the “Agreement”) for “consulting and training provided to Noella Caspersz by [DT] the ongoing training I set at $400 per hour [sic]. Training will start in August 2019 at three hours a week on Wednesday mornings through zoom meetings.”
The Agreement, as written, would amount to Caspersz paying DT $1,200 a week, or $62,400 a year.
The Agreement further states that “an indebtedness will accumulate each week and you can make payments against the balance owing as your business grows from the ongoing training.” No interest rate or repayment period is provided.
Invoices dated November 30, 2021, January 5, 2022, March 21, 2022, and June 20, 2022, purport to have a DT-controlled company bill Caspersz for “Educational, Online and Marketing Training Services” in irregular amounts that total $14,815. No amounts for harmonized sales taxes are listed, and there’s no indication of training hours apparently provided. Caspersz told a FSRA Investigator that she paid the invoices.
The timing of the invoice payments roughly corresponds to the dates that clients DT referred to Caspersz purchased policies through her.
In October 2022, DT sent an email to some of his clients titled “Protecting Noella” which included directions regarding how to answer questions from FSRA if the clients were contacted concerning their interactions with Caspersz. Those directions included not mentioning DT’s name and advising the clients to provide material misstatements to FSRA, specifically: “[e]verything you have done is through Noella.” DT wrote in bold text that licensed agents “can not share commissions with anyone who is not licensed. If they did, they would lose their license.”
In an email sent to his clients in August 2023, DT explained that “Right now, your investments were provided by [another agent] or Noella with my help.” DT stated that the arrangement was legal “as long as [Caspersz and another agent] only pay me for training which they are invoiced for at $400 per hour.”

D. Caspersz’s FSRA Interview

Caspersz was interviewed by a FSRA Investigator on December 1, 2023. During the interview, Caspersz indicated that she had received training from DT between 2019 and 2022, and that she had agreed to pay DT $400/hour for the training.
When she was asked to provide records to show that the training occurred, Caspersz could provide only minimal records of training materials allegedly shared during this three-year period. Further, the training was apparently held online, but Caspersz was unable to provide records of any online meetings with DT, or other evidence that the meetings had actually occurred.
Caspersz did not provide any record of her tracking training hours or notes of training, despite telling the Investigator in the interview that she had kept both. She further affirmed that she had met clients referred by DT in person.
Caspersz knew that DT was not licenced as an insurance agent when the training sessions occurred but could not recall specifically when she learned this.
In written responses provided to the FSRA Investigator through counsel, Caspersz also affirmed that she selected funds for clients primarily based on the fund Fact Sheets, while DT and others from time to time provided her with information about funds.

IV. CONTRAVENTIONS OR FAILURES TO COMPLY WITH THE ACT

A. Paying Compensation to a Non-Licensee for Placing or Negotiating Life Insurance

Section 403(1) of the Act states that no broker, insurer, or an officer, employee or agent of an insurer shall directly or indirectly pay or allow, or agree to pay or allow, compensation to be paid to a non-licensee for placing or negotiating life insurance in Ontario, or for attempting to do so.
Caspersz knew that DT was not licensed under the Act. She knew or ought to have known that DT was placing or negotiating life insurance as he continued to meet with the clients and to provide them with specific insurance advice and in many cases she was not providing insurance advice.
Caspersz directly paid DT a portion of commissions pursuant to their agreement. Caspersz paid DT $14,815. These payments were commission splitting with DT, who was providing advice to the clients about which insurance products they should select. Caspersz attempted to conceal and obfuscate the nature of the commission payments through the agreement with DT and invoices.
The Director is satisfied that Caspersz contravened section 403(1) by paying compensation or allowing compensation to be paid to a non-licensee, in exchange for the non-licensee’s placing or negotiating of life insurance.

B. Providing False or Misleading Information to FSRA

Section 447(2)(a) of the Act states that it is an offence to directly or indirectly furnish false, misleading or incomplete information to FSRA.
During her interview with FSRA and in related written communications, Caspersz provided FSRA with false or misleading information. Caspersz, an experienced agent who was previously the subject of enforcement, must have known that that the substance of her agreement was not training, but commission sharing, yet continued to affirm to the Investigator that training had occurred and that was why she was paying DT.
Caspersz also provided further false or misleading information, such as affirming that she had met the clients in person and that she had chosen the funds for clients to invest in, when really it was DT advising clients and selecting the funds.
The Director is satisfied that Caspersz provided false or misleading information to FSRA in contravention of section 447(2)(a).

V. GROUNDS FOR REFUSING TO RENEW LICENCE

Section 392.4 of the Act states that the Chief Executive Officer shall renew an insurance agent’s licence if the agent has satisfied the prescribed requirements for a licence unless he believes on reasonable grounds that the applicant is not suitable to be licensed, having regard to such circumstances as may be prescribed and other matters the Chief Executive Officer considers appropriate.
The prescribed grounds are set out in sections 4 and 8 of Ontario Regulation 347/04. The ground listed in section 8(d) is that the licensee has demonstrated incompetence or untrustworthiness to transact the insurance agency business for which the licence has been granted.
Section 7(4) of Ontario Regulation 347/04, allows the Chief Executive Officer to refuse to renew an insurance agent’s licence if the agent has failed to comply with the Act, the regulations or a condition of the licence.
The Director has reasonable grounds to believe that Caspersz is not suitable for licensing under the Act. In addition to the reasons outlined in the 2023 NOP, Caspersz has demonstrated incompetence and untrustworthiness to transact business as an insurance agent and has contravened sections 403 and 447(2)(a).
When a licensed individual like Caspersz incentivizes a non-licensee like DT to solicit and negotiate life insurance, they put the public at risk and rob clients of valuable protections, like errors and omissions insurance, proficiency requirements and regulatory oversight. By engaging in the Agreement with DT and paying her a portion of the commissions generated by his referrals, Caspersz has shown incompetence and untrustworthiness.
In addition, FSRA relies on licensees to provide it with truthful and accurate information in order to regulate the insurance sector and to protect the public. Through her false or misleading responses relating to her relationship with DT, Caspersz has attempted to obstruct FSRA from investigating her non-compliance with the Act and the potential non-compliance of others, including DT. In doing so, she demonstrated untrustworthiness to transact the business of insurance.
The Director is satisfied that a sanction less than refusal, such as suspension or licence conditions, would not reflect the severity of Caspersz’s conduct and would not adequately protect the public. Caspersz has already been suspended in the past with similar conduct, and another suspension is unlikely to protect the public and prevent future similar conduct.

VI. GROUNDS FOR IMPOSING ADMINISTRATIVE PENALTIES

The Director is satisfied that imposing administrative penalties under section 441.3(1) of the Act for the contraventions of sections 403 and 447(2)(a) described above will satisfy both of the following purposes under section 441.2(1):
1. To promote compliance with the requirements established under the Act; and
2. To prevent a person from deriving, directly or indirectly, any economic benefit because of contravening or failing to comply with a requirement established under the Act.
Section 403 is listed in Schedule 2 of Ontario Regulation 408/12 and contraventions of the section carry a maximum penalty of $50,000 for an individual. Section 447(2) is listed in Schedule 1 and carries a maximum penalty of $100,000 for an individual.
In determining the amount of the administrative penalties, the Director has considered the following criteria as required by section 4(2) of Ontario Regulation 408/12:
1. The degree to which the contravention or failure was intentional, reckless or negligent;
2. The extent of the harm or potential harm to others resulting from the contravention or failure;
3. The extent to which the person or entity tried to mitigate any loss or take other remedial action;
4. The extent to which the person or entity derived or reasonably might have expected to derive, directly or indirectly, any economic benefit from the contravention or failure; and
5. Any other contraventions or failures to comply with a requirement established under the Act or with any other financial services legislation of Ontario or of any jurisdiction during the preceding five years by the person or entity.
In respect of the first criterion, the Director is satisfied that Caspersz acted intentionally in paying DT, a non-licensee, commissions in exchange for him placing or negotiating life insurance. Further, Caspersz knew that the information she provided to FSRA respecting this relationship with DT and her interaction with her clients was false or misleading.
In respect of the second criterion, the Director is satisfied that Caspersz’s conduct created potential harm to others. Confidence in the licensing system was undermined by Caspersz incentivizing DT, a non-licensee, to solicit and negotiate insurance business without the regulatory supervision that comes with being a licensee.
In addition, by providing false or misleading information to FSRA about the nature of her relationship with DT, she obfuscated the ongoing relationship DT has with some clients, slowing the investigation and risking further harm.
In respect of the third criterion, Caspersz took no steps to mitigate the harm caused by her actions.
In respect of the fourth criterion, the Director is satisfied that Caspersz received an economic benefit from her contraventions. She profited $45,234.23 in commissions on policies related to the 16 clients referred to her by DT.
In respect of the fifth criterion, the Director is unaware of any contraventions or failures to comply with a requirement established under the Act or with any other financial services legislation in Ontario or of any jurisdiction during the preceding five years by Caspersz, besides those outlined in the 2023 NOP. Caspersz’s previous licence suspension from FSCO was in 2009.

DATED at Toronto, Ontario, September 4, 2024.

Original signed by

Elissa Sinha
Director, Litigation and Enforcement

By delegated authority from the Chief Executive Officer

Si vous desirez recevoir cet avis en français, veuillez nous envoyer votre demande par courriel immediatement a : contactcentre@fsrao.ca.

NOTICE OF PROPOSAL TO REFUSE TO RENEW LICENCE AND TO IMPOSE ADMINISTRATIVE PENALTIES