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An Inside Look into Fraud Prevention: Two Different Extremes

fraud preventionHere at Sherlock Investigations, we take claims investigations very seriously. As one might imagine, fraud investigators have the pleasure of seeing both the good and the bad
in the insurance industry. In some cases, claims we investigate don’t even have a fraudulent component. Injuries, financial losses, or even vehicle replacements in auto-liability cases are all viable and reasonable needs to file a claim with your insurance provider. However, in many cases, we see fraudulent claims that often times have no basis at all for needing additional compensation from an insurance company. In this blog, I’d like to cover two recent cases that we, as research investigators, see situations similar to on a regular basis. To give a better idea of how these investigations work in our field, I’ll cover the extremes: a claim that was obviously fraudulent and a claim that was obviously deserving of being validated.

Situation #1 – A fraudulent disability claim in the making

As a member of the research team, I often see cases before they are deemed valid enough or before enough information is gathered to begin surveillance on a subject. In many cases, our clients don’t really know what is going on with a particular claimant, so they hire us to complete a background investigation and activities check just to see how or what the particular individual is doing with their life following the loss in question.

In this case, a big city public transportation operator (bus driver) filed a claim after being involved in an accident while on duty. We received the information detailing that the claimant in this situation couldn’t “preform the abilities of her job” to the same level as before the loss: assisting passengers on and off the bus, carrying items on and off, turning the bus wheel to steer, etc. To start out, we always conduct background investigations first where criminal and civil records are checked, along with any bankruptcies/liens/judgements that the subject may have files in the past. We additionally file FOIA requests with jurisdictions in which the subject lives to gather pertinent information related to law enforcement contacts, or even to discover if the individual has been involved in any more recent motor vehicle accidents. Following this, we conduct a through social media investigation, followed by discreet activities inquiries to discover evidence about a subject’s current levels of activity. Right off the bat, we located several dismissed motor vehicle claims against different insurance companies in the subject’s civil records, along with a spotty financial history when it came to filing bankruptcies and other small claims judgements where or subject was the defendant. When we began our social media search, the situation behind this investigation became even more clear. Our subject was what one would call the “party type:” throwing weekly “themed dance parties” at private clubs in her hometown, where she appeared in multiple videos dancing, running around, and jumping on and off of tables in the early hours of the morning. In addition, posts were collected where the subject mentioned how much she “loved her job” and was more deserving of a raise than any of her other co-workers. After discreetly speaking with a friend who informed us that she didn’t believe the subject to be suffering from any injuries after the loss, we closed the case and returned our file to our client.

Cases will often be re-opened by our clients in the pursuit of more specific information as it relates to a claim; in this case, our clients wanted to subpoena the subject’s workplace for video of her operating the bus, just to observe her while she was at work. Records like these are not public, and in some cases, need a court order to be released. We reached out to the employer to see if we could send a FOIA request for this information, where we were told that we would need the subject’s bus number to find the correct video. Unfortunately, we knew that our subject was on a regular route, however, we were informed that workers weren’t regularly assigned to specific buses, so locating her records would be a lengthy process.

Situation #2 – little-to-no information turns into a valid claim

In when conducting these investigations, little to no information about a person or a claim may seem like a problem or an indicator of fraud—this is often not the case. Sometimes a file is opened with us to see what is going on with a subject in anticipation of a claim, and sometimes a claim is filed with information so puzzling that it makes more sense for us to figure it out.

In this case, we knew that the subject was a late 20s or early 30s white male, veteran & engineer that was involved in a motor vehicle accident on an interstate. The police report detailed “incapacitating injuries” and that the subject was transported from the scene. Records searches and a thorough background investigation was conducted, where our subject was relatively clean in terms of criminal records, civil suits, bankruptcies, liens, and other judgements. Other than a few traffic tickets and a prior divorce, our subject seemed to be your regular, hard-working individual. When we completed our social media searches, we learned what actually happened with this situation: the subject received traumatic injuries to one leg and his abdomen, resulting in an amputation above the knee and had over 10 surgeries to repair damage to the stomach and intestines. After being put into a medically induced coma to heal, the subject’s future was uncertain. Several GoFundMe campaigns were located that detailed these facts of the loss, along with facts about the subject’s wife who was pregnant with their first child at the time of the incident. While social media references detailed that the claimant was healing at a slow pace, many of his friends speculated that he may never leave the hospital again.

A close associate indicated that he was actually at the hospital with the subject for a couple weeks following the accident. No one was sure if the subject would be released in the near future and to what extent he would be able to return to his normal, daily life. A report was created with this information and then passed along to our client.

6-8 months following the loss, we were asked to re-open the file to check on the subject’s situation. Social media references were updated with activity being posted again from the subject’s personal accounts, detailing that he had healed and was working on new business ventures following his accident. Photos depicted the subject using a wheelchair, along with business cards detailing that he has started his very own landscaping business for both residential and commercial customers. Discreet contact was made with a neighbor around the source’s home, where we learned that our subject was doing much better following the accident and appeared to be in good spirits. Our source confirmed that he was active in his lawn mowing business and otherwise was going about his life to the best of his ability—with some major changes made in his life after the fact.

Day in and day out, we see varying cases like these. It keeps us on our toes; not knowing what to expect and going into an investigation with an open mind is something that may seem difficult to do but is actually a necessity in our business. When it comes to reporting the facts of a situation, we never assume anything to be true or to be false—if a claim moves forward to litigation and unvalidated information is used, it can make or break the case for our clients. These are just a few rules we live by when doing research, and as always, our end goal is to make the best of any situation that comes across our desks.