definition of fraud types of fraud how does fraud affect you? what you can do to protect yourself

Objectives

Definition of Fraud Types of Fraud How does fraud affect you? What you can do to protect yourself

What is “Fraud”?

MN IASIU

Fraud is deceit; it’s trickery; it’s cheating; it’s committed to cause a

person or organization like an insurance company to give up property or some lawful right.

Basically, fraud isINTENTIONAL DECEPTION for the purpose of financial

gain.

How Big Is the Problem of Fraud?

How Big Is the Problem of Fraud?

Coalition Against Insurance Fraud Insurance Fraud Costs Americans an

Estimated; $80 Billion Dollars a Year

Cost to you; an estimated $1000 a year per family

What could your family do with $1000 a year?

Insurance Fraud

According to NICB:

An estimated 3 out of every 10 insurance claims may involve fraud.

Fraudulent claims account for 10 to 30 cents out of every claim dollar.

The Reality of Insurance Fraud

Reasons people commit insurance fraud: 56% feel they can get away with it 32% feel they are paying too much for

insurance 24% are making up for their deductible

(Accenture Survey – 2004)

The Cost

The extent of Insurance Fraud is difficult to quantify: Much of it goes undetected Health is endangered

Innocent people are killed or maimed Employees lose jobs

How else are you affected?

Increase in cost of goods & services

Increase in insurance premiums

Increase in cost of medical care

Insurance Fraud

Characteristics of people who are involved in insurance fraud:

Types of Fraud

No-Fault Insurance Fraud Billing for services not provided Performing unnecessary and potentially

harmful tests and procedures Worker’s Compensation Fraud

Knowingly lie about work related injury or illness to receive benefits

Altered Documents

Types of Fraud Slip and Falls Premium Fraud Vehicle Thefts Property Claims Staged Accidents/Passenger Stuffing Caused Accidents Identity Theft Fraud Paper Cars and Vin Transfers Multiple Claims

Fraud Comes in Many Forms

Life Insurance Fraud Faked death Murder for Insurance

Health Care Provider Fraud

ARSON

Owner Give Ups

Organized Fraud Activity

Auto Accident Fraud/Organized Ring Activity:Padding claimsCaused or Staged Accidents

Jump-ins/Passenger Stuffing Fake helpers/Accomplice witnesses

Organized Fraud Activity

Cappers/Runners Professionals

Medical Providers Lawyers Interpreters

Staged Accidents All parties knowingly involved Passenger Stuffing

Caused Accidents Targets-Innocent Parties

Female drivers Expensive cars Buses, delivery trucks 18 wheelers

Staged Accident Scenarios

The Investigators: Counterfeit crashes

By Andy Wise - bio | email MEMPHIS, TN (WMC TV) -

One person's fender-bender might be a scam artist's fraud.

Copyright 2010 WMC-TV. All rights reserved.

The Drive Down

The Freeway Swoop & Squat

The Panic Stop

The Swoop & Squat

Caught On Tape: Staged Accidents

What could happen if you are in an accident?

Someone may come to your door You may receive mailings from doctors and

lawyers You may receive phone calls

How to Protect Yourself:Health Care Provider Fraud Ask Questions about Treatment Review your doctor bills and explanation of

benefits (EOB) form from your insurance company

Be wary if doctor recommends any new, unusual or experimental treatment

Be wary if doctor recommends specific attorney or if attorney recommends specific doctor

Organized Fraud Activity

Organized Fraud Activity

How to Protect Yourself:

Auto Accident Fraud To avoid caused accidents, such as a

“Swoop & Squat, don’t follow other cars too closely

Look beyond the car in front of you while driving. Avoid distractions; cell phone, etc.

If you are in accident you believe is staged, insist on calling the police and tell your insurance company

What Can You do to fight Insurance Fraud?

Call Police Call your Insurance Agent-even if the accident

is minor Take photos of damage and people Note plate # Note number of people in the car Do not leave the scene

Who Should Fight Insurance Fraud?

Law Enforcement? The Government? Individuals? Insurance Industry?

Answer: 90% of the public feel the insurance industry should be responsible for fighting insurance fraud.

What can you do to fight Insurance Fraud?

1-888-FRAUDMN

1-800-TEL-NICB

Final Thoughts. . .

Fighting fraud is a team sport – we need everyone to win the game.

Questions?

Thank you!Information gathered for this presentation was obtained through the Minnesota Chapter of the International

Association of Special Investigation Units (MN IASIU) and outside sources.