Featured Fraud: It All Adds Up

It is not uncommon to hear of criminals being discovered because their stories just “don’t add up.” In this case, the stories of 32 people did add up … to a whopping $3 million in fraudulent insurance payouts.

A recent FBI-led investigation in South Texas dubbed “Operation Sitting Duck” led to the indictment of 32 people on federal insurance fraud charges. Between 2001 and 2010, approximately 21,600 purportedly fake claims for minor injuries and accompanying doctors’ accident reports were submitted to AFLAC in a scheme involving those 32 people.

Investigation revealed that two unnamed doctors at a Reynosa, Mexico family clinic were signing off on fake accident reports, receiving $10 to $15 for each alleged injury, and instructed the fraudsters to avoid requests from the insurer for X-rays or medical tests. According to the indictments, compensation for each claim ranged from $100 to $500.

What made this situation unique was the use of AFLAC’s accident-only insurance plan. Different than primary medical insurance, this policy is supplemental and covers costs after unexpected injuries when a person is unable to work.

Among those indicted were a police officer, county employees, and schoolteachers.

According to prosecutors, anyone convicted will be required to pay back fraudulently obtained funds. Additionally, those convicted face up to 20 years in prison and a $250,000 for each count of conspiracy and wire fraud.

Comments

Resource Center

View All »

Integrated Content & Communications: A Key Business Issue For Insurers

Insurers are renewing their focus on top line growth, and many are learning that growth...

High Risk Insurance Coverage in the E&S Market

Experts discuss market conditions, trends and projected growth in a rapidly changing niche.

Top E-Signature Security Requirements

This white paper covers the most important security features to look for when evaluating e-signatures...

EPLI Programs Crafted Just For Your Clients

Bring us your restaurant clients, associations and other groups and we’ll help you win more...

Is It Time To Step Up And Own An Agency?

Download this eBook for insight on how to determine if owning an agency is right...

Claims - The Good The Bad And The Ugly

Fraudulent claims cost the industry and the public thousands of dollars in losses. This article...

Leveraging BI for Improved Claims Performance and Results

If claims organizations do not avail themselves of the latest business intelligence (BI) tools, they...

Top 10 Legal Requirements for E-Signatures in Insurance

Want to make sure you’ve covered all your bases when adopting e-signatures? Learn how to...

Get $100 in leads with $0 down!

NetQuote's detailed, real-time leads have boosted sales for thousands of successful local agents across the...

The Growing Role of Excess & Surplus Lines in Today’s...

The excess and surplus market (E&S) provides coverage when standard insurance carriers cannot or will...

Forensic Insider eNewsletter

Get investigative information and forensic insight to help you reach optimal claims outcomes – FREE. Sign Up Now!

Claims-Handling Guidelines

Claims Magazine is providing the following free guidelines and regulations in order to help adjusting professionals stay abreast of each state’s unique property and casualty claim-handling requirements.

View our State Guidelines »

Advertisement. Closing in 15 seconds.