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| NEWS LETTER |
White collar Crimes & Insurance Claims
By Mohan Nagarkar
The dictionary meaning of the term crime is an act against the law, a wicked act wrong doing, sin " A person who commits a crime is called criminal, Normally when we think about a criminal, a imaginary picture of a thief, burglary, robber, murderer etc appears before our eyes. White-collar crime is much wider term and may include large number of socio economic offences. We being part of the insurance industry are more concerned with the white-collar crimes, which are covered in various insurance policies. We are concerned with white collar crimes like forgery, misappropriation & embezzlement of
stock or money by the employee's theft by employees, misutilization of lost or stolen credit cards etc. such white collar crimes claims are on rise now a days.
Occupational offences are normally taken care under Fidelity Guarantee Insurance Policies. While scrutinizing such claim, when we try to go to the root cause of the incidence, we notice that in efficient supervisory controls, inadequate internal administrative controls, contribute to the loss. Too much confidence on an employee handling sensitive portfolios like finance, sales etc. may induce him to commit misappropriation or fraud. Sudden rise in the standard of living of the employee,too much sincerity shown by the employee, and feed back from staff & customers are some of the symptoms of occupational offences to which a good administrator should not overlook Under Banker's Indemnity Insurance claim we come across cases of forgery or alterations, which another type of white-collar crime. Under forgery a person prepares and makes signature of another person in such documents, and on the basis of such a document, he embezzles the money. A forger may forge signature of another customer or even that of the bank official/s. Many times it takes long time to detect such
losses.
In banks many times the work is carried out in good faith slight variations in signatures may not come to the notice of the passing officer. In case of chemical alterations on the DD's or cheques , if change is visible to naked eyes then cognizance is taken & the passing officer may go in to deep to check the authenticity of the said instrument But when such alteration is not visible to naked eyes then job of the passing officer becomes more difficult. Ultra violet ray machines are provided to thebankers but hardly they are used because the officer has to pass large number of instruments within a short time. Bankers Indemnify policy excludes the losses which are resulted due to negligent act of bank employees
A more recent type of white-collar crime on rise now a days is misutilisation of credit cards. We will deal with this topic in a separate article.
SURVEY AND INVESTIGATION OF FRAUDULENT CLAIMS
By Mohan Nagarkar
By & large, most of the claims are normal, straight, and genuine. While giving instructions to the Surveyor, the underwriters may not have idea as to whether the claim is genuine or otherwise. Based upon the estimate of loss, the Surveyor is appointed. Large claims are normally allotted to a Senior Surveyor as he has gathered experience to handle such claims over a period of time.
When the Surveyor visit the place of loss and starts his job, he observes the situation, discuss with the Insured or his representative. He may also get an opportunity to discuss the eyewitness of the loss. Nearby dwellers, residents also gather when Survey is being carried out. The Surveyor may get some information about the loss from them. During this process the surveyor is trying to co-relate situation. Some times he get convinced about the loss but some times he feels that something is missing/fishy in the natural chain of events. Although the Surveyor is not expected to be suspicious while carrying out the Survey, he is expected to be reasonably cautious. During this process he may notice some foul play, he may get certain hint, information, clue which may lead him to assume that prima facie there is to believe that the claim appears to be fraudulent.
Upon encountering such situation it is necessary that, the surveyor should discuss with the underwriters who appointed him. He should put his preliminary information, and evidence in support of his opinion before the appropriate authority. During such discussion the scope of work of the surveyor may be decided. Some times the Surveyor may be asked to do both i.e.Survey as well as investigation. If the under writers feel it appropriate they may appoint an independent investigator and may instruct the Surveyor just to assess the loss.
As far as fraudulent claims are concerned the purpose of the investigation in to go beyond the normal stereotyped job of loss assessment and to find out the truth. The fate of the claim in such cases, largely depends upon the conclusion of the Investigation. The Surveyor or investigator has to produce documentary evidence in support of his findings as the claim might be challenged in the court of law.
The job of the investigator is very tricky one may compare it with that of the police officer or a detective. There is no laid down procedure or method to carry out investigation, as it may differ from case to case.
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= Information
= News
= Verification
= Enquiry
= Statements
= Testing
= Interrogations
= Gospel/absolute truth
= Assessment
= Testimony
= Imagination
= Observations
= Nab
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