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The Temptation of Fraud  

Barry Zalma, Esq., CFE presents videos so you can learn how insurance  fraud is perpetrated and what is necessary to deter or defeat insurance  fraud. This Video Blog of True Crime Stories of Insurance Fraud with the  names and places changed to protect the guilty are all based upon  investigations conducted by me and fictionalized to create a learning  environment for claims personnel, SIU investigators, insurers, police,  and lawyers better understand insurance fraud and weapons that can be  used to deter or defeat a fraudulent insurance claim.  

Why Honest People Commit Fraud Without Compunction  Studies show that insurance fraud is most often a crime of opportunity  rather than serious planning. Honest people, when presenting an  insurance claim, often have their moral compass point south rather than  true north.  A person who would walk a mile to return $5 in extra change received  from a waitress will add $5,000 to an insurance claim without a second  thought. A lawyer whose word is honored throughout his state will,  without compunction, demand payment for \\u201cpain and suffering\\u201d when he was  rear-ended even though he resolved all his pain with two aspirin. A  judge who has been honored by his peers for his sense of justice and  fair play will claim the theft of computers he never owned. A housewife  and mother who would beat a child\\u2019s bottom raw for stealing a 50-cent  candy bar sees nothing wrong with adding $2,500.00 to a claim for smoke  damage in her kitchen.  Insurance fraud is easier than working and, often, more profitable. The  Fraud Division, California Department of Insurance and the industry have  been fighting the rings and professional claimants with vigor. They  have ignored, because there is little profit or publicity value in it,  the small frauds like the plaintiff in the case I described go  unpunished and often succeed.  

The IRC report makes it clear that the professional criminals are 10% of  the crime. These professionals should be prosecuted. Only an insurance  industry noted for its short-sighted search for instant gratification,  would put all its fraud fighting dollars against 10% of the problem and  none of its fraud fighting dollars against 90% of the problem.  Insurers need a long-term anti-fraud program that goes against the real  problem, the opportunist. The honest person must be educated \\u2014 by  punishment if required \\u2014 that insurance fraud is the same as theft,  burglary or armed robbery. People who build-up a claim or otherwise  defraud an insurer are as much a criminal as the person who robs a bank  with a gun.  Funds that have been cut from insurance claims training must be  restored, investigative efforts must be accelerated, claims handlers  must be encouraged to refer claims to their Special Investigative Units  (SIU) rather than to close as many files as possible.  

(c) 2022 Barry Zalma & ClaimSchool, Inc.