The South African Insurance Crime has revealed how criminals are trying to defraud insurance companies – and how the efforts to curb insurance fraud are bringing these fraudsters to justice! We would like to qupte from the recent newsletter by the SAICB:
April and May 2011 have been exciting months for the SAICB with many of our cases going through the courts with successful outcomes.
SAICB CASES UPDATE
Case 1: The suspect was found guilty on 3 December 2010 in Cape Town for submitting fraudulent claims and sentenced to R20 000,00 or two years in prison—R10 000,00 and one year was suspended for 5 years on condition that she is not found guilty of fraud or theft during the suspended period.
The suspect committed fraud again and on 3 May 2011, she was found guilty again and sentence to 12 months imprisonment, 6 months suspended for 5 years. Potential lost of R14 000.00
Case 2: Incident 1 The suspect claimed that he was involved in accident with the vehicle (BMW M6) on the 16 March 2010. Inception date of the policy was 18 December 2009. The vehicle was insured by a SAICB member company, who declined the claim based on dishonesty and the policy was cancelled.
Incident 2: The same vehicle was insured by another SAICB member company and was allegedly involved in an accident in 4 December 2010, policy inception date— 1 July 2010.
During the SAICB investigation, it was noted that the vehicle had a repudiated claim at another insurer and that the damages in the current claim were found to be exactly the same as with the first incident.
When client was confronted with the facts, he admitted that he could not afford to have the vehicle repaired and had insured the vehicle with another insurer. The suspect kept the car for several months in his garage at home and had it towed from there to the repairer. He even arranged for a fraudulent inspection report from a glass service provider, which cost him R500. The towing service provider was also involved in the whole fraudulent incident.
Suspect was arrested and was sentenced on 19 April 2011 to 3 years imprisonment wholly
suspended for 5 years. Potential loss R361 000.00.
Case 3: Suspect claimed for 3 Harley Davidson‘s and a bakkie and trailer. Vehicles were never stolen, but stored at storage facility. The suspect did not pay for the storage facility and SAPS was called in when the contents of the container were noted. The SAICB was contacted by SAPS to assist with the identification of the vehicles and who they were insured by. Trailer and bakkie claims had been paid out by two SAICB member companies, and the other insurers involved had repudiated the claims for the bikes. Total loss approximately R1,1 million.
The suspect was arrested, convicted and sentenced to 8 years suspended for 5 years. He paid back the monies to the insurers for the payments already made, as part of his plea bargain agreement.
Case 4: Wrecked vehicles were purchased from a salvage yard and vehicles were repaired to a certain extent and insured. The suspects staged accidents with each other, their roles in these incidents varied. In one claim, suspect A was the driver, in another claim he appeared as a passenger in the vehicle, and in another was a witness etc. The syndicate was identified by the SAICB and the investigation completed and handed to the NPA in April 2011. The first arrest was made on the weekend of the 21 May 2011 and further arrests are expected before the end of May 2011. Value of loss is estimated at R2,1 million.