Napier insurance broker David McGuffie was cleared last month of four charges made against him of making dishonest claims to insurance companies.
But the former owner/founder of Advanced Insurance Ltd said the two and a half years of waiting for his name to finally be cleared had taken its toll on him and his family.
“Our business doesn’t exist, I can’t sell insurance now because I was personally bankrupted through the personal guarantees I had stood against our company. We lost a lot of money,” he told NZ Adviser's
sister site, Insurance Business
“And my reputation around Napier is ruined. I’ve had people who’ve known me for years saying once your court case is cleared come and have a talk to us, but it took another year and a half for that to happen.”
The whole thing came about, he said, because of a disgruntled employee who took out a personal grievance listing eight different issues she had against him and the company.
These ranged from sexual harassment to not being able to use the toilet facilities to their full potential.
“The whole thing came as a complete shock because her actions didn’t match the actions of the person we knew who worked for us.
“She had been a very good worker.”
McGuffie said he engaged an HR company to help him manage the process, and they went to a mediation meeting with the woman who was seeking a $30,000 settlement.
When the mediation failed, she then took McGuffie to the Employment Court, which didn’t work for her either, he said.
The woman, who had full access to sensitive company information and trust accounts, then sent information from clients’ files to four insurance companies (Asteron Insurance, Tower Insurance, AIA Insurance and Pinnacle Insurance) while alleging wrongdoing. He said they too investigated and couldn’t find anything of substance.
The Financial Markets Authority
(FMA) also declined there was any case to be investigated when she approached them, he said.
Her next step was to take the matter to the police, who subsequently arrested and charged McGuffie.
“It just got worse from there,” he said, with an appearance in Napier District Court occurring in June 2015.
“I was accused of using insurance applications for pecuniary gain and to illegally gain commissions that shouldn’t have been paid.
“If that was the case I would be in jail because the insurance companies would have taken me to court, but it didn’t come from the insurance companies, it was brought about by a disgruntled employee who lost a personal grievance case and just continued to find ways to destroy my credibility in the industry.”
McGuffie does admit to two slip-ups in his 13-year insurance career.
“The two major mistakes I made was paying two people’s premiums when they were in financial trouble and couldn’t keep their policies going.
“This is against my agency’s agreement but it’s not illegal. But they made a meal out of that as well,” he said.
Determined to prove his innocence, McGuffie said he requested a jury trial: “I wanted to be in court with the people who had been saying all these things and having to answer to all they’d said.
“The reason I stood my ground was firstly because all these things she said were untrue, and secondly, if I’d capitulated and paid her the $30,000 she’d be able to be employed by someone else and could do the exact same thing to them that she did to us and possibly crush that person’s life.”
He said he believed the woman’s motives were fuelled by her own financial difficulties and jealousy at his success and as each of her attempts failed, her determination to bring him down grew.
McGuffie said relief finally came last month following a decision by the FMA expert enlisted by the Crown Prosecutor to withdraw from appearing, saying they felt uncomfortable going any further acting as an expert on the case.
“Subsequently I went to court on 8th March and the whole case was dismissed due to a lack of credible evidence. There was nothing there that stated I did anything wrong at all.”
McGuffie said while he was incredibly relieved by that news, he had still lost a huge amount.
“It’s really sad, I’ve had people that we did joint venture work with who won’t even talk to me.
“I’ve tried to keep a happy positive attitude towards it because otherwise I’d just curl up in a ball and lose everything.”
Another business he joined, called Brokermatch where he would pair up brokers with clients according to their needs and personalities, had also suffered due to the allegations made against him.
“The FMA had been alerted that I was out selling insurance again, so I had to provide details of exactly how Brokermatch worked.
“So even when I’d lost my business and joined another company people were complaining so it had become a personal vendetta by some people,” he said.
As soon as the timeframe for his bankruptcy is up, McGuffie said he aims to be back selling insurance.
“I’m not a malicious person, what’s happened has already happened so I can’t change that.”
“All I can do is work hard and ethically to build a better future for my wife, family and the people I sit in front of.”
Insurance Business was awaiting comment from the four companies and the FMA at the time of publication.
This article is from our sister site, Insurance Business by Maryvonne Gray.