Insurance Authority bans two former insurance agents for three years for using false academic certificates under the former self-regulatory regime
22 November 2023
The Insurance Authority (IA) has taken disciplinary action against two former insurance agents who had each used two false academic certificates on different occasions to establish that they had met the minimum education requirements to be insurance agents under the former self-regulatory regime. Both cases were handled in accordance with the requirements in place at the time the false academic certificates were submitted.
In both cases, the former agents each used a false academic certificate (in 2013 and 2017 respectively) when first applying to be registered with the Insurance Agents Registration Board (IARB) as insurance agents of authorized insurers. Subsequently, the IARB implemented the Enhanced Vetting Requirements, requiring agents to provide further supporting information to verify the authenticity of their academic certificates. In seeking to satisfy the Enhanced Vetting Requirements, in 2019 each agent then submitted another academic certificate to the IARB to demonstrate that they had met the minimum education requirements. Again, both certificates were false. In both cases, the agents had not attained the minimum education requirements as they had not graduated from the institutions stated on the academic certificates submitted.
Insurance agents are required to act ethically and to have integrity as a basic standard of professionalism. Members of the public place their trust in insurance agents when relying on their advice and recommendations on insurance matters. Individuals who display such a lack of ethics and integrity by using false academic certificates in a submission to a regulator violate that trust. They are deserving of being prohibited from playing any part in the insurance market again until such time as they are able to demonstrate such a complete reformation of character as to be trusted again, a process that must be underpinned with the acceptance and admission of the wrongdoing.
The cases on false academic certificates which the IA continues to handle emanate from the period before the IA took over the regulation of licensed insurance intermediaries on 23 September 2019. These cases have to be handled in accordance with the transitional arrangements in Schedule 11 of the Insurance Ordinance (Cap. 41) (the Ordinance), which require the relevant requirements in place at the time to be applied and the disciplinary approach of the IARB1 to be followed. The IA will continue to discipline these cases robustly and to the fullest extent of these constraints, and publish that it is doing so, to continually reinforce the message that these disgraceful actions were as completely unacceptable then, as they are now and must be confined to the past.
Since the IA took over the regulation of licensed insurance intermediaries, an express provision has been introduced to the Ordinance making it a criminal offence to provide false information to the IA in connection with an application for a licence or an approval under the Ordinance2. An individual who commits such offence, if found guilty, will be liable to a fine at level 53 and to imprisonment for 6 months. The IA will have no hesitation in prosecuting any individual who seeks to submit a false academic certificate to the IA as part of the licensing process under the current regime.
The IA reminds insurers (and their intermediary management control functions) that they also have an important role to play in ensuring that, as part of their recruitment and on-boarding processes for new insurance agents, adequate checks are carried out to verify the accuracy of the information being submitted to the IA as part of licensing applications by their prospective new insurance agents. The checking and verification processes adopted by the insurer are a vital part of an insurer’s on-boarding processes before the appointment of a new insurance agent. Through its inspection of insurers and ongoing conduct supervision work, the IA will continue to assess the adequacy of insurers’ controls and processes on this issue and hold them accountable for this.
For further information on the IA’s enforcement work, please see the “Enforcement News” section of the IA’s website. Public disciplinary actions against licensed insurance intermediaries may also be searched on the Register of Licensed Insurance Intermediaries on our website.
Ends
Notes:
1 Pursuant to section 113(4)(d) of Schedule 11 to the Insurance Ordinance (Cap. 41), in handling non-compliance cases unresolved by the Self-Regulatory Organisations (SROs), the IA may impose a disciplinary sanction on a specified person that could have been imposed by the SRO concerned had the case been handled by the body.
2 Section 64ZZE of the Ordinance sets out the offence to provide false information in connection with application for licence or approval.
3 Pursuant to Schedule 8 to the Criminal Procedure Ordinance (Cap. 221), a fine at level 5 is HK$50,000 at present.