Journal of Insurance Fraud in America

A crime wave of fake health plans risks a sorry repeat if a proposal to authorize so-called Association Health Plans is adopted in its current format. Ambiguities in whether states would play a fully empowered role in overseeing today’s Association Health Plans leave open a trap door of vulnerability to schemers.

More than 200,000 Americans were defrauded by operators of phony health plans in 2002-2004, leaving many with ruinous medical bills and sagging finances. Bogus plans swept across the U.S. like germ warfare. A steady flow of defrauded health-insurance buyers incited national headlines back in 2002-2004. State and federal regulators finally crashed the party and shut down the schemes in concert with federal crackdown.  Read article.

by MATTHEW SMITH, Esq. | May 2018


Fraud is a unique crime with many distinctive features. Its complexity is worthy of deep exploration; its high costs require this effort. Yet there is limited research to assist with preventative strategies. At the core is the lack of research on the psychology of insurance fraudsters: knowing what motivates — and de-motivates — them to commit this crime.

Psychological research hones in, with more precision, on the core reasons criminals behave in deviant ways. Understanding this is key to developing anti-fraud strategies that focus directly on the problem’s nucleus — the fraudster’s mind and motivations. Read article.

by J. MICHAEL SKIBA, MBA, PhD | March 2018


A workers-compensation insurer’s audit reveals that the 10-person clerical business the insurer thought it covered actually is a 100-person window-washing firm, specializing in high-rise buildings. That can be dangerous work, high up on the scaffolding. The employer illegally paid minimal workers-compensation premiums by misclassifying its business and lowballing the number of employees. The owner might have paid tens of  thousands of dollars more in premiums a year if he’d told his workers-compensation insurer the truth.

Premium fraud in workers compensation has long bedeviled insurers. The growing willingness of insurers and prosecutors to combat these expensive schemes is something new and welcome. The question is what are an insurer’s remedies? The answer involves traditional approaches along with newer ones — some that are untried though promising. Read article.

by DENNIS B. KASS | January 2018


A pronounced fraud and abuse trend in recent years involves fabricated and often useless tests to diagnose the health of muscles and nerve cells that control them.

These tests can help diagnose radiculopathy and other nerve injuries in vehicle crash victims. Dishonest practitioners also can easily manipulate the tests, creating a gateway to expensive insurance scams. While medically helpful, these tests track with a larger national trend of extensive fraud in the diverse field of diagnostic tests. This is especially true for automobile and workers compensation. Read article.

by Dr. JOHN E. ROBINTON | October 2017


A concerning trend in claims management and civil litigation that will have a major impact on insurance fraud is the emergence of “investments” in personal-injury litigation by third-party lenders. Traditionally, personal-injury attorneys finance suits from their own pocket. That includes costs of taking a personal-injury civil matter to trial. Filing fees, process servers, stenographers and expert fees are a risk borne by the plaintiff’s attorney. Read article.

by ADAM BRAND & JAMES CRAIG | August 2017


Special Investigation Units (SIUs) are key components of any healthy insurance company because of their ability to recognize and fight fraud. However, these units often operate today more or less on their own, separate from the general claims function within insurance enterprises. Read article.

by KEITH DALY | July 2017


Privacy being redefined by vast information fraud fighters can access from connected devices, others sources. Fraud fighters must set fair privacy standards to avoid policymakers imposing standards on them. Read article.

by MATTHEW SMITH, Esq. | May 2017


Scammers evolve tactics for medical equipment, sham clinics, nerve tests

Nimble scammers are evolving tactics to overbill insurers for expensive durable medical equipment and compound creams — and launder ill-gotten profits. Insurers are stepping up the pressure with affirmative civil and criminal actions. Read article.

by ROBERT A. STERN & JAMES A. MCKENNEY | April 2017


Report drills deep into fraud in life insurance and disability

Fraud fighters perceive fewer scams; yet organized rings seen growing. Recommendations include closer cooperation between insurers and law enforcement. Read article.

by DENNIS JAY | April 2017


Anti-fraud tech evolving faster than speed of prediction

Anti-fraud tech is growing faster than anyone can fully predict their impact. Forward-thinking insurers are embracing options such as Internet of Things, mobile phones, metadata, geolocation and digital footprints. Read article.

by DAN DRAZ | April 2017


misclassification_thumbShell games: How construction cons steal workers-comp premiums

A troubling trend of construction firms illegally hiding workers in shell companies to avoid paying state-required workers-compensation coverage began emerging in Florida in the early 2000s.

Historically, dishonest contractors lowballed large amounts of their payroll, undetected. The goal was to under-report employees and salaries, and lie that employees worked safer jobs than they really did. Read article.

by DAVID M. BORUM, CIFI, CFI, CIFI | October 2016


Older myths crumbling under weight of newer arson science

arson_thumbDramatic legal changes will affect every fire investigator and arson case, and thus every insurer involved in fire-claims litigation. Investigators wishing to justify conclusions from the process of elimination must carefully document all hypotheses considered and ruled out. Read article.

by GEORGE A. CODDING | October 2016


In the cards: Anti-fraud tech tilts odds toward insurers, spurs claimant satisfaction

tech_thumbAs technology transforms data into shared intelligence, claims will be validated more promptly. Increased transparency will eliminate much of the unknown. Decision-making and claim transparency also will reduce a claimant’s opportunity and inclination to defraud. Read article.

by THOMAS MULEY | September 2016


Compounded pain creams compound scams with fraudulent pricing, kickbacks

compounding_thumbAutomobile and workers-compensation insurers are the primary targets of scams involving expensive compounded pain creams. Prices are extremely high, yet there is little evidence the creams work. Doctors can make up to $10,000 monthly by prescribing compounded creams, which patients often don’t need. Read article

by CAROL CRISCI, JASON HANFORD & BARAK KASSUTTO | June 2016

Enhanced data-sharing uncovers workers-comp misclassifying schemes in N.C.

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Employer misclassification of workers leaves injured workers without medical care, and creates an unfair competitive playing field. State agencies in North Carolina are sharing data that is critical to pursuing businesses that illegally misclassify workers. Read article

by RYAN BOYCE | June 2016

Did life-insurance murderer target sister-in-law as next victim?

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Harold Henthorn received life in prison for pushing his wife Toni Bertolet off a cliff for $4.6 million of life-insurance money. In a first-person story, the sister-in -law of his first wife chillingly believes Henthorn also targeted her for murder. Read article.

by GRACE RISHELL | June 2016

Zeroing in on zero tolerance in combatting insurance fraud

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Values are the bedrock of any insurance company. Zero tolerance for fraud is a key value. Leaders must create an effective anti-fraud program. That includes a company-wide culture of zero tolerance involving all employees. Read article

by GEORGE FAY | June 2016

Courts broadly view fraud laws to bolster crime fighting

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Fraud is a serious crime that requires broad interpretations of statutes to effectively fight this crime, several recent court rulings suggest. Dishonest clinics, staged crashes and state-insurer ties recently were scrutinized. Several decision support the Coalition’s policy of urging of courts to broadly construe laws. Read article

by MATTHEW SMITH, Esq. | June 2016

TrendWatch: New developments about fraud in America

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Mobile phones and wearables are emerging anti-fraud battlegrounds. … New York’s Supreme Court will review Facebook’s efforts to block access to accounts in a disability-fraud probe. … A state agency is ramping up anti-fraud messages. The umbrella name: “Idiots, liars and losers.” Read article.

By Coalition Staff | June 2016