Toronto, Ontario – The Financial Services Regulatory Authority of Ontario (FSRA) has recently imposed a compliance order and an order imposing administrative penalties of $75,000 on McLaren Collision and $15,000 on Fardy Warda.
The compliance order is the result of fraudulent insurance charging performed by both parties. Specifically, McLaren Collision charged an insurer for repairs to vehicles that were not done and for parts that were not replaced, while Fardy Warda damaged a vehicle taken to McLaren for repair, allowing Mclaren to increase the amounts charged to insurers.
These actions violate section 439 of the Insurance Act as well as paragraph 1 of subsection 3(2) of O. Reg. 7/00.
“FSRA is committed to protecting consumers and ensuring public confidence in the insurance sector,” said Elissa Sinha, Director of Litigation and Enforcement at FSRA, “auto body shops can only charge insurers for work that is needed and performed. FSRA will not tolerate this conduct.”
FSRA issued the orders as a result of a settlement with McLaren and Fardy Warda.
Rony Warda and Michael Wetzel were also included in the same “Notice of Proposal” as McLaren and Warda. Proceedings are ongoing before the Financial Services Tribunal regarding Rony Warda. On November 24, 2020, FSRA issued an order regarding Michael Wetzel since he did not request a hearing.
The compliance order prohibits McLaren and Fardy Warda from engaging in the business of insurance. The businesses are not allowed to perform work that is reasonably expected to be paid by an insurer or hold themselves out as being able to perform such work.
These restrictions apply to McLaren permanently and to Fardy Warda for three months.
