Canadians Demand Changes Following Auto Insurance Scandal

August 22, 2008

Vancouver activists are criticizing the Canadian government-run Insurance Corp. of British Columbia, one of the biggest auto insurance providers in Canada. In the wake of a scandal a involving an illegal money-making project among ICBC employees, activists demand large-scale changes in the way the company oversees its operations.

Previously this week, an investigation by industry watchdog PricewaterhouseCoopers, showed that 55 automobiles insured through ICBC and damaged in collisions were fixed at ICBC’s collision-repair training shop. They were then auctioned off wholesale, then resold at a vast discount to company insiders–including high-level managerial staff, as well as relatives of ICBC workers. Many of the cars were later resold once more by those affiliated with the scheme, yielding a substantial revenue. The PricewaterhouseCoopers investigation also showed that schemes of this nature have been going on at the insurance company since at least 2006. People have tried to report what was happening, yet no one had adequately looked into the claims.

ICBC’s chief executive officer, Geri Prior has asserted that all who were involved with the scheme have since been terminated from, or have voluntarily left, the company. ICBC has also made efforts to inform all workers that purchasing salvage automobiles is strictly against company rules. Prior did not tell the press how many workers were, in fact, involved, nor on what terms they left ICBC.

Activist Michael Farnworth says ICBC and the Canadian government aren’t doing enough to rectify the situation post-scandal, or to prevent future abuses. He questions the government’s decision to reassign three top ICBC employees to their original positions. The three employees whose reappointment he opposes are Ken Martin, chairman of ICBC’s the human resources and compensation committee, and committee directors Diane Fulton and Neil de Gelder.

“The government knows about this investigation, they now that this report is coming down, and they go ahead and reappoint three members of the board that have been there while the whole scandal has taken place,” fumed Farnsworth. “At the end of the day, the board of directors are put there and they are accountable.”

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