A new fraud study by Alpharetta, Ga.-based researcher LexisNexis finds that no industry is immune to effortsby individuals intent on stealing money or information.

The study, which surveyed 800 fraud mitigation professionals,revealed significant evidence of cross-industry fraud with seriousfinancial repercussions for some of the industries affected, mostnotably insurance, financial services, retail, health care andcommunications, as well as government entities.

Their concerns about fraud varied depending on the industry.

Identity theft created more concern for the financial services(61%) and retail (52%) industries. Claims fraud was more of anissue in the insurance (60%) and health care (45%) industries.Communications professionals said that hacking (61%) gave them themost heartburn, and the government said that fraud involvingemployees (52%) was its top issue.

Eighty-four percent of the professionals said that some of thefraud cases they examine are tied to another industry, particularlythose investigating insurance fraud. However, investigators for thegovernment or in health care were less likely to find their casesoverlap with another industry.

Mitigation professionals in the insurance (68%) and financialservices (64%) industries believe that sharing fraud data withinthose industries would be helpful in combatting fraud. Otherprofessionals agreed that sharing information outside of their ownindustry could be very valuable 42% of the time and moderatelyvaluable 33% of the time.

The majority of professionals surveyed (89%) agreed thatdeveloping universal fraud descriptors would be very helpful,particularly those in the insurance industry (63%) and those infinancial services (61%). 

In addition, a majority of the respondents (81%) said they wouldconsider contributing their fraud outcomes to a shared database ifit meant they would receive fraud information from contributors inother industries.

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Fraud concerns vary by industry, but claims fraud is thenumber one issue for insurance professionals. (Photo:Shutterstock)

What kinds of fraud keep investigators up atnight?

The study identified several types of fraud that create the mostconcern for mitigation professionals including:

• Identity theft (49%).
• Data/IT hacks or software fraud (45%).
• Fraud involving employees/agents (37%).
• Claims fraud (34%).
• Misrepresentation/lying on application for services (31%).
• Collusion/organized fraud activity (26%).
• Fraudulent access to benefits (25%).
• Fraud targeting seniors (18%).

Respondents also said they would spend any extra money availableon technology (27%) and training (20%) to increase theirfraud-fighting efforts. Other areas where they were willing toinvest were process improvement (14%), staffing (13%), analytics(12%) and more data (11%).

The mitigation professionals also identified several areas wherethey see fraud within their customer interactions:

• Account servicing (43%).
• Application/underwriting (33%).
• Claims/reimbursement requests/returns (21%).
• Product marketing (16%).
• Retention (14%).

Study respondents also indicated that almost 75% are using dataanalytics solutions as part of their fraud mitigation programs,primarily automated business rules, behavioral analytics,predictive modeling and in some cases informal database searches.The full fraud mitigation study is available directly from LexisNexis.