A former employee at insurance company, Liberty Group Limited, was debarred as a financial service representative after the Financial Services Tribunal ( FST) found that he manipulated clients by taking out policies without their knowledge.
The decision was made after Nico Rautenbach approached the FST to reconsider his debarment by his former employer.
Rautenbach who was paid over R400,000 in commission, was exposed after Liberty received a complaint in April 2023 from a client, D, who was unhappy with the debit orders effected on his account for insurance premiums he never took out.
D said he only had two existing policies and was paying a mere R550, however, his profile showed that he had at least eight policies and R9,000 was debited from his account.
D stated that when the policies were issued he received a One-time pin (OTP) which he shared with Rautenbach but he he was not told what the pin was for.
He said because of this, almost R40,000 was debited from his account.
After D’s complaint, Liberty investigated the matter and found that one policy was duplicated four times, and Rautenbach also submitted incorrect documents in relation to other policies.
While Liberty was still investigating D’s case, Rautenbach resigned from work with immediate effect citing personal reasons.
During the course of the investigation, Liberty discovered that there were more clients with complaints against Rautenbach for policies issued without their consent.
Amongst some of the clients, JD, she said she has been unemployed since 2020 but Rautenbach created 15 policies under her name.
She said when she received the OTP on her phone, she gave it to Rautenbach because he told her he was attending payments that were due to her.
However, she never received any money from Rautenbach.
Meanwhile, V had fifteen policies under his portfolio but no payments were received by Liberty. When a manager at Liberty met with V, he said he was not aware that he had so many policies.
Similar to V, JV had ten policies in his name and no payments were received by the insurer. When the manager made attempts to get hold of JV, he could not be reached on details attached to his profile.
The manager said the emails sent to him bounced back and the number provided did not exist.
Also with a similar case was EM, she had sixteen retirement annuities in her name and no payments were made to the insurer. The manager made several attempts to make contact with EM, however, the attached email address on her profile was not working as well as her number.
In July 2023, the manager requested Rautenbach to provide him with EM’s correct contact details and he didn’t respond.
He was subsequently debarred in November 2023.
When he approached the FST, Rautenbach claimed that he had new evidence which will show that the evidence against him by Liberty was incorrect.
He further denied initiating policies without the clients’ consent and knowledge and argued that the commissions were not obtained fraudulently.
Furthermore, he submitted that he followed proper procedure when issuing the policies and the clients’ signatures were properly obtained from them and that they were also aware of the policies.
However, when the FST looked at the evidence, it was said that the number of policies issued under the name of each client was alarming.
It was also noted that Rautenbach managed to keep more than 50 policies active on the system without a single premium being collected.
It was further mentioned that it was surprising that only Rautenbach could get hold of the clients but the manager could not get them when using the same information provided on their profile.
The FST concluded that Rautenbach manipulated the clients and acted dishonestly in his dealings.
“The facts support Liberty’s finding that Rautenbach lacked honesty in rendering financial services. In the premises, the tribunal can find no basis to interfere with the Liberty’s decision to debar Rautenbach,” the FST said in its ruling.
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