It's no secret that fraud in the property/casualty realm is arampant problem. Whether it's hard fraud involving staged autoaccidents or property arson or soft fraud that is opportunisticallyexecuted by a claimant who exaggerates a legitimate claim, fraud isa crime the Insurance Information Institute estimates costs theproperty/casualty industry more than $30 billion in 2005 and alsois responsible for increasing aggregate policyholder premiums.

What often is not talked about, however, are the cases involvingclaim adjusters who cross over into the criminal realm and conspireto benefit from their positions, blurring the line between theopportunity and forethought definitions of hard and soft fraud.Just how prevalent this problem is remains unclear, but here are athree cases involving claim adjusters who tried to work the systemand failed:

Terrance A. Tasker was a claim adjuster forNationwide Insurance and treasurer of his choir group calledUnlimited Praise. According to information from U.S. attorney RodJ. Rosenstein, however, Tasker created fake claimants for claims hewas investigating. The scheme involved transmitting electronicpayment authorizations to Nationwide in Columbus, Ohio, directingpayment to the fictitious claimants. Under Tasker's instructions,Nationwide sent 47 checks totaling more than $118,000 to a postoffice in Maryland from March 2001 to November 2003, where he wouldendorse the checks in the name of Unlimited Praise and deposit theminto the choir's bank account. Tasker then would withdraw thedeposited money for his own personal use or write checks from thataccount to credit card companies for balances owed by him. He faces10 years in prison and a $250,000 fine.

Karla E. Biven used to work for the MarylandAutomobile Insurance Fund as a claim adjuster. According to astatement from the Maryland Attorney General's Office, she had ahabit of adding fictitious claimants to legitimate auto accidentclaims. Once a settlement was achieved, Biven disbursed thefraudulently obtained money to an acquaintance in at least twoseparate instances for amounts totaling more than $7,000. Heractivities were discovered after an internal audit by the MarylandAutomobile Insurance Fund. She was ordered to serve 60 days ofprobation, make full restitution to her former company, and serve24 hours of community service.

Tracy Parrish worked as a casualty claimadjuster in Virginia for Nationwide. According to the VirginiaState Police Insurance Fraud Program, she embezzled more than$21,000 from her employer, issuing 52 fraudulent checks to 44different recipients over the span of seven months. Each check wasissued for an amount slightly under or equal to her check-writingauthority limit of $500, and an investigation proved that most ofthe checks were made out to actual claimants. However, Parrish keptthe checks, forged the claimants' and her husband's signatures, anddeposited them into her husband's checking account. On top of that,17 were made payable to Parrish, her family members, or variationsof their names. She was sentenced on six felony charges and orderedto make full restitution to her former employer. She also receiveda 10-year sentence, suspended for 20 years with good behavior, forthe embezzlement charge.