Can insurance companies secretly plant cameras in a private business in the hope of catching it doing something wrong?

That's the question an Ontario court will deal with next month as it determines whether criminal charges should be laid against five employees of Aviva Canada — and a private investigator the insurance company hired —who secretly recorded what was happening inside 10 Toronto-area businesses.

On Wednesday, the owner of one of those businesses — which is facing legal action by Aviva — appeared in a Toronto court hoping to argue the insurance company's employees should be charged with mischief, conspiracy and interception of private communications.

Sting operation by insurer

"Aviva crossed a very serious line when they did this. They took it upon themselves to enter a facility through video cameras, and watch everything that goes on there and listen to conversations," Cos Licursi, the owner of Eugene Collision, told CBC Toronto

The allegations stem from a public relations campaign Aviva mounted earlier this year showing how it was trying to combat insurance fraud.

Aviva produced a video revealing it had rigged 10 cars with hidden cameras and microphones, then intentionally damaged the cars by driving them into each other.

Aviva had the damage appraised before leaving the cars at the side of Toronto highways. The cars were towed or driven to 10 different Greater Toronto Area auto body shops. One of the cars was taken to Eugene Collision.

The idea was to see if the body shops would overcharge for the repairs. The sting operation was quarterbacked by Aviva's internal fraud investigators — three of whom are former Toronto police officers.

The insurance company's secret recordings were shared with CTV's W5, which aired Aviva's allegations of fraud.

Aviva is now suing several of the body shops, accusing them of overcharging.

In Licursi's case, Aviva claims he overcharged about $360 on a $2,440 repair. Licursi counters that an Aviva appraiser inspected the damaged car at his body shop before any work commenced. The repairs and costs were exactly what Aviva had authorized, he says.

Licursi claims his shop did nothing wrong, but Aviva's hidden cameras "recorded our employees at work and on their breaks. It recorded our customers who may have been in the shop, and it filmed all our procedures and techniques, some of which are exclusive to us, and are trade secrets which we would never have consented to be recorded."

Even police 'require a warrant,' complainant argues

Licursi says the insurance company acted like a "peeping Tom," and that police "would require a warrant" to start spying on private businesses.

In Canada, it's illegal to plant listening and video devices inside a private business or home without the owner's consent.

Police can't do it legally unless they obtain a court order.

Licursi says he supports Aviva's efforts to expose insurance fraud, but he claims his company's reputation was unfairly tarnished and that Aviva "can't engage in alleged criminal activity simply as a means to obtain evidence of alleged wrongdoing."

Toronto police were asked to investigate the allegations against Aviva and the three former police officers. The investigator assigned to the case earlier this month declined to take action.

It's not clear why.

So, Licursi and his legal team have begun the process of trying to convince an Ontario justice of the peace to lay criminal charges against the individuals.

They point to Section 184(1) of Canada's Criminal Code which states anyone "who wilfully intercepts a private communication is guilty of an indictable offence and liable for imprisonment for a term not exceeding five years."

Aviva's actions have 'wider implications,' lawyer says

Licursi's lawyer Xavier Navarrete says the situation has much "wider implications to the public."

He says if Aviva's investigators aren't held accountable, other companies may believe they have a green light to plant secret recording devices in places like doctors' offices or even people's homes without consent.

Licursi's lawyer, Xavier Navarrete, says the situation has serious privacy implications for the general public. (Mary Webster/CBC)

"If an insurance company is of the view that someone is committing something that they think is wrong," said Navarrete, "they'll have the unilateral ability to insert cameras in locations where people have an expectation of privacy."

It also opens the door to "corporate espionage," where companies could spy on each other without fear of criminal prosecution, he says.

"Aviva has acted arrogantly and has been bragging about breaking these privacy laws and needs to be punished to the full extent of the law," Licursi argues.

"I would love to plant a camera in Aviva to see what they're doing … but I can't do that because it's against the law," he says.

Aviva's response

Priscilla Wong, Aviva's spokesperson, told CBC Toronto the company was not aware of the allegations being levelled against its employees. But she says Aviva stands by its effort to root out fraud.

"We remain resolute in our commitment to address fraud that costs Ontario drivers millions of dollars a year in additional premiums," Wong wrote in a statement.

"Aviva has acted lawfully during the process of this investigation. We were unaware of the allegations to which you refer, however, it appears to come as a response to our pursuit of certain body shops and individuals in the civil courts to recover damages for fraudulent auto body repair invoicing," she wrote.

"As these matters are currently before the court, we cannot provide further comment."

Wednesday's hearing was adjourned, and whether any charges will be laid against the Aviva investigators is expected to be argued in court next month.