Broker loses licence for failing to disclose two of his bankruptcies

A B.C. broker received a two-year licence suspension and a $7,500 fine for failing to disclose two of his bankruptcies to the province’s broker regulator.

Amarpal Singh Atwal, who has been licensed as a broker since 1983, filed for bankruptcy in 2017, declaring assets of $2,102 and liabilities exceeding $2.7 million. The Insurance Council of B.C. found out about the bankruptcy on July 30, 2018, when it received information from a local bankruptcy trustee.

While investigating the circumstances surrounding the 2017 bankruptcy, council discovered that Atwal had also been bankrupt in 1993. In his 1993 bankruptcy, Atwal claimed $260,000 in assets and $710,000 in liabilities.

Neither bankruptcy was reported to council.

Atwal had three opportunities to declare the bankruptcies, the council decision states. Specifically, he failed to disclose his bankruptcies when he:

• filed an application for a Level 2 general insurance licence in July 2016;
• submitted a life agent application in December 2008;
• applied to have his Level 2 general licence reinstated in April 1995.

“On all three occasions, the former licensee…signed a declaration confirming that information provided in the applications was true and complete,” the council noted in its decision.

“These breaches of the Rules and the Code [of Conduct] by the former licensee are very concerning to the hearing committee and should be regarded as serious misconduct,” the council’s Mar. 31, 2020 decision states. “It would be very challenging for the council to carry out its public interest mandate without being able to rely on licensees and applicants to provide truthful and complete information to the council during the license application process.”

“Furthermore,” council went on to say, “the former licensee was an experienced agent and had been licensed with the council off and on for almost 35 years. As an experienced licensee, he would certainly have known that he was required to be careful and honest in his applications with council as he pursued additional licenses.”

Council’s order sided with the position taken by a council representative at the hearing that Atwal’s “lack of financial responsibility, as evidenced by his repeated financial issues, combined with his efforts to conceal these matters from the council, are demonstrative of a licensee who is an ongoing risk to the public.”

Council further observed that Atwal requested a hearing to plead his case, and then failed to show up to the hearing. Council said “out of an abundance of caution,” it agreed to start the proceeding later than the originally-scheduled start time, just to make sure the broker wasn’t simply late for the hearing. But when the broker didn’t show up, council moved ahead, satisfied that it had shown procedural fairness.

Council said it did not treat Atwal’s lack of participation in the hearing as an aggravating factor in his penalty, but it did “cause concerns for the council about the overall governability of the former licensee.”