Coalition partnering for stronger government affairs

We all know today’s business mantra is to do more with less … the “less” meaning fewer personnel, less funding and stretching of resources. While accepting this “new reality,” many of us are quick to criticize these changes from what we were accustomed to for many years.

Without debating the pros and cons of the financial and human resources limits facing today’s fraud fighters, many positive things are occurring as well under new business models. These often require more-creative thinking and working cooperatively to achieve results.

While it is far too early to tell if this will be a major and continuing trend, one positive thing the Coalition is monitoring is the increase in our member (and organizations looking to strengthen their partnership with the Coalition. Jointly, we’re working to expand our impact on legislative initiatives and government-affairs efforts.

We regularly meet with our fraud-fighting partners, and non-traditional partners when necessary, to help move an anti-fraud agenda forward.

Partnerships are an important tool as we fight insurance fraud. For instance, we partner in several states including Kentucky, Virginia and New Mexico as members of statewide insurance advisory boards. We partnered with NICB to push for funding of dedicated fraud prosecutors in Virginia. We also partner with non-traditional groups like the carpenters union on workers compensation premium-avoidance schemes, and with Honda America to help thwart counterfeit airbags.

Working in partnership helps bring the anti-fraud message forward more forcefully. The message is good both for consumers and insurers. The Coalition is ready and able to partner and achieve shared legislative goals to help protect America’s consumers from both being victims of, and paying for, insurance fraud.

The more we work cooperatively as a multi-faceted team in approaching government affairs the more impactful, and successful, our efforts will become.

The Coalition remains a unique voice uniting America’s consumers, insurers and government agencies to let our message and concerns be known from the halls of Congress through 50 state legislatures. And now we’ve expanded those efforts with a program of amicus briefs in key U.S. federal and state courts.

We are here to serve all our members — and the American public — and welcome partnering with you to fight fraud.

About the author: Matthew J. Smith serves as general counsel and associate director of government affairs for the Coalition Against Insurance Fraud.

11 years ago there was a troubling disturbance in the anti-fraud force

As the Coalition prepares to celebrate 25 years of combating insurance fraud, let’s glance back and explore milestones, key successes and discuss the great progress the fraud-fighting community has enjoyed.

But such wasn’t the case 11 years ago this month when plans were being drawn up to fold the three major anti-fraud organizations into one. A proposal to combine the Coalition, NICB and International Association of SIUs had been pursued aggressively for more than a year. The plan created controversy and deep distrust among the organizations.

The idea for a single organization to focus on fraud in the property/casualty arena arose from the consulting firm of McKinsey & Company, which sold the proposal to members of the Chief Claim Officers Roundtable.

On the surface, it seemed having one organization would improve efficiencies and create a united front against fraud. But digging deeper, which McKinsey failed to do, would’ve found three organizations with different missions and divergent constituencies. It was a half-baked idea that likely would have ended in disaster.

The dance of dealing with efforts to combine organizations lasted a full year. Our vital work on combating fraud slowed to a snail’s pace. Momentum was lost, and no one knew if the Coalition or IASIU would survive. There were hard feelings all around. The Coalition lost about $100,000 in dues revenue from insurers who wanted no part of consolidation. At least one insurer subsequently quit because it favored the proposal.

Fortunately, IASIU members came to the rescue in September 2006 and voted to stay independent. The merger then was abandoned.

While it wasn’t the finest hour for the fraud-fighting community, there was a silver lining. The merger discussions helped the three organizations know each other much better. All three soon signed a memorandum of understanding to work together against fraud crimes.

Since then, the three groups have been active partners working jointly on a variety of projects that have greatly benefited our common cause in curbing fraud. All three also have flourished in achieving great success — and we expect that will continue for the foreseeable future.

On an ironic side note, the lead consultant in this boondoggle from McKinsey & Company — the guy who came up with the merger idea — was convicted earlier this year of a $500,000-plus fraud scheme. He’ll be sentenced next month in federal court — while our three anti-fraud organizations continue thriving.

About the author: Dennis Jay is executive director of the Coalition Against Insurance Fraud.

Kind man burned alive in home insurance arson

David O’Dell was a gentle man, mentally slowed by a head injury, yet good-natured and trusting. He lived alone in an aging wooden house. He had no idea the home would become his coffin. O’Dell was burned alive for insurance money by someone he considered his best friend.

O’Dell worked for Joseph Meyers in upstate Wayland, N.Y. Meyers and his wife Iryn wanted to buy a double-wide trailer to upgrade their living quarters, and Joseph planned to buy two tow-truck businesses.

O’Dell and insurance money were their gateways to the good life. The couple abused his trusting nature. They maneuvered to buy the aging house from him for half its value. Cunningly, they let O’Dell keep living there as he had since childhood.

The couple insured the house and Iryn’s possessions for about $125,000, and secretly bought a $40,000 life-insurance policy on O’Dell. The insurance setup was in place. Joseph and Iryn used a blow torch to burn down the old tinder-box home, leaving O’Dell inside to roast alive.

Victim burned alive

He died a horrific death. Flames quickly engulfed the brittle wooden home early that chilly February morning in 2016. O’Dell had no chance. He was quickly incinerated down to 97 pounds of charred debris and seared bones. Medical examiners had to compare his singed backbone with an old X-ray to identify him.

Joseph and Iryn tried to make O’Dell take the fall. He’d lost touch with reality and wanted to kill himself, they told investigators. O’Dell left his clothes on the heater after hearing “voices” telling him to burn down the house. Increasingly unhinged, he also stole $40 from a tool box at Meyers’ business shortly before the fire. At least that’s the sham story the couple fed investigators. The fairy tale quickly fell flat.

In fact O’Dell was careful about using fire around the house he so enjoyed, grieving relatives countered. He knew the home was a fire hazard and made sure flammables were handled well.

“When he was using the wood burners, he was always very careful. He could smell the smoke, and he would get up and take care of it, so he was extremely wary of any kind of smoke in that house,” older brother Phil O’Dell said.

Burn patterns found on furnace

Experts also discovered “ignitable liquid patterns” on a wood-burning furnace in the basement, meaning someone intentionally set the fire. And surprise, a propane torch was found at Joseph’s business.

Joseph also forgot to turn off his cell phone. A phone mapping analyst tracked him and Iryn back and forth between their place and O’Dell’s house three times just hours before the fire. Surveillance video from Joseph’s business, which was based at his home, matched the phone findings.

O’Dell’s siblings loyally sat in the courtroom, looking for justice for their youngest brother. More relatives joined in, such was their caring for O’Dell.

Instead of that snazzy new double-wide, Joseph and Iryn will spend 23 years to life in cramped jail cells. They were convicted of arson, insurance fraud, murder and other offenses.

“It tears your heart right out,” said older brother Phillip O’Dell. “Your baby brother. (That) somebody whose is supposedly good friends would do something like that to him, to that extreme. Why they would do it at all, I don’t know. It just rips your heart out.”

Credibility of anti-fraud efforts placed at risk

Whatever your opinion of illegal immigration, you have to feel uneasy about a report last week that insurers in Florida are denying benefits to severely injured workers based on a legal technicality.

An investigation by ProPublica aired on NPR says one and maybe more insurers routinely deny claims by injured immigrant workers because they used fake Social Security numbers when seeking care. Thus, they’re committing workers-compensation fraud.

Identity theft is a serious problem, and the state fraud bureau rightfully is investigating.

But in the process, legitimately injured workers are being denied healthcare.

That’s not only wrong — no matter what their immigration status may be — but it also paints insurers as uncaring, greedy corporations that allow human suffering to make a buck. It places the credibility of combating real fraud at risk.

And if that’s not bad enough, the report suggests some employers intentionally hire undocumented workers. The employers know that if injured, the workers can be denied care, thus saving the employer on workers-comp costs.

In the absence of a functional federal government working to reform immigration laws, legislators in the Sunshine State need to correct this loophole so workers hurt on the job get the care they need.

About the author: Dennis Jay is executive director of the Coalition Against Insurance Fraud.