A Winnipeg couple took on one of Canada's largest insurance companies and won.
A judge has ordered Great-West Life to pay Michel and Lorraine Mignault more than $528,000. The couple was one of the victims of Gary Palmer, an agent of Great-West Life, who took their life savings.
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"They're happy that they won. Obviously it's a long haul — it took them seven years," said Dave Hill, the lawyer for the Mignaults.
Statement from GWL
Issued on Monday in reaction to judgment:
"Great-West Life is disappointed with the decision. We are reviewing the decision and considering an appeal.
"This is a rare and unfortunate situation where a single independent adviser was found to have committed fraud."
Palmer was convicted of fraud in 2010 and sentenced to serve eight years in prison. He pleaded guilty to 15 counts of fraud after spending more than $1.5 million worth of several clients' money.
"We took the position - that the judge later sanctioned - that he was an agent of Great West Life, and if you're a legal agent of a company, the company is liable for your actions, even fraud," said Hill Thursday.
Great West Life had argued Palmer was not an agent of the company, but an 'independent contractor.'
But Judge Brenda Keyser disagreed. She ruled Great West Life "cloaked [Palmer] with the attributions of apparent authority."
"They [Mignaults] believed he was a Great-West Life agent, so they dealt with him from 1991 right up to 2006 when they were advised by Great-West Life that the funds they had left were something in the neighbourhood of $9,000," he said.
The ruling is good news to investor Greg Downey, who lost more than $30,000 to Palmer.
"It was definitely uplifting because it's been seven years we've been going through this," he said Thursday.
Downey said the ruling gives him, and others with pending lawsuits against Great West Life, hope.
"It's been tough on quite a few of the people," he said. "Some have dropped out. Three ... have passed away before they had a chance to see justice done."
Close to two dozen other former clients have been waiting for this judgment so they can proceed with their own cases, Hill said.
The frauds occurred between 1998 and 2006.
Police said Palmer presented himself as a financial adviser and convinced a number of people to make withdrawals from their current investment accounts on the premise of transferring the funds to new products.
He then deposited the money into his business account and used it for his own personal use.
The scheme came to light when a client received a tax bill for the withdrawals.
Great-West Life conducted an internal investigation then notified the police. Charges were laid in 2006.
A spokesperson for Great West Life said Thursday the company is disappointed with the decision, and is considering an appeal.