On Monday, the corporate regulator confirmed that it has commenced civil proceedings in Federal Court against Keith Cohen and Robert Oayda. It’s alleged Mr Cohen and Mr Oayda were involved in decisions that saw sales agents qualify for overseas holidays if they reached certain targets and a Vespa scooter for the agent who made the most sales.
ASIC has raised concerns that the incentives influenced the sales agents’ conduct and led to a lack of focus on customer needs.
It’s alleged that between November 2017 and October 2018 Mr Cohen was knowingly concerned in or a party to breaches of the conflicted remuneration provisions by Freedom Insurance and the now-liquidated Insurance Network Services Australia involving two separate trips to Bali and a Vespa scooter, and that Mr Oayda was also involved or a party to the Freedom Insurance breaches.
“The impact of incentives when selling financial products has been a longstanding issue for ASIC. We are concerned that incentives may cause sales agents [to] put their own need for sales and reward above the needs of their customers,” ASIC deputy chair Sarah Court said.
“The alleged conduct relates to the marketing and selling by Freedom Insurance of insurance products issued by Swiss Re Life and Health Australia Limited, including final expenses cover (a type of life cover), accidental death cover and accidental injury cover.”
ASIC is seeking declarations, civil penalties, injunctions and disqualification orders against Mr Cohen, and declarations and injunctions against Mr Oayda.
A date for the proceedings is yet to be confirmed.
Great work ASIC. I love that you are targeting companies who sell insurances which help famalies at their time of need. Im sure the extra insurance costs will cause way more harm to society than pay day loans to minimum wage earners and people on the dole paying for things they dont need with afterpay.
Ummm, they were selling insurance what’s the problem with that?? I’m sure RACV, AAMI, CGU and every other insurer has sales targets and KPI’s. Is it now illegal to even sell a regulated insurance product?
So a financial services employer can no longer incentivise an employee to go above and beyond the call of duty? Cannot reward exceptional performance or reward an individuals impressive contribution to a business. Is it now a legislatively restricted environment similar to the public service or government jobs where mediocrity reigns supreme and where there is no incentive to do better, to sell more, to achieve more, to grow a business? Just do the bare minimum for your fixed salary and not one ounce of effort more. Imagine if a plasterer trying to get ahead in life worked at a faster rate to plaster more houses to make more money? God forbid what this country is coming to. Gotta love those RC lawyers, politicians and bureaucrats.
what a toxic disgrace this ASIC mob are, and yet this asleep at the wheel Liberal Goverment allows this rubbish to spew out on a daily basis, never ever thought i would think it! yet alone say it, but the sooner this govt his history, the better off ouy industry will be.
Yet ASIC has KPIs on the amount of litigation and successful EUs issued, with top performing staff receiving financial incentives…pot calling the kettle black.
double standards.
…and there are no incentives to sue a party when someone else is footing the bill…
OK – understand all this, but where is the evidence any client suffered financial damage etc?