Staged collisions, unscrupulous auto repair shops, fraudulent medical clinics
KITCHENER, Ontario, March 27, 2014 /Canada NewsWire/ - Although Fraud Prevention Month is winding down, Insurance Bureau ofCanada (IBC) is continuing to take a proactive role in alerting Canadians about the different types of insurance fraud that exist, and asking them to report any suspected incidences.
Insurance fraud is a huge problem that is estimated to cost Ontarians up to $1.6 billion per year by wasting resources and adding to the price tag of insurance premiums, health care, emergency response services and court costs.
Rick Dubin, Vice-President of IBC's Investigative Services, was in Kitchener to speak about this issue. "Fraud is a serious offence that affects us all. Being aware that fraud exists and that we could become victims is the first step to reducing fraud," said Mr. Dubin.
Mr. Dubin heads up IBC's national investigative team that works with, and on behalf of, IBC's member companies to investigate the involvement of organized crime rings in insurance fraud. IBC also partners with law enforcement, government agencies across the country to identify suspected insurance crime, investigate fraudsters and scam artists, and bring these criminals to justice.
In his presentation, Mr. Dubin explained that insurance crime is often the work of organized criminal groups who are involved in auto theft and/or staged collisions, then file fraudulent injury and accident benefit claims. Unscrupulous auto body shops intentionally cause additional damage, then bill insurers for services that were never rendered. Fraudulent medical clinics request that a person injured in a motor vehicle collision sign blank forms. After the person has completed treatment, the medical clinic, having the person's name and signature on the blank forms, continues to submit invoices for additional treatment and assessments never carried out to their insurance company. Mr. Dubin also made reference to the fact that insurance fraud can involve normally law-abiding citizens who see a chance to make a few extra dollars by padding an otherwise legitimate claim.
"Insurance criminals take money right out of our pockets – when they cheat, we all pay" said Mr. Dubin. "When someone makes a false or exaggerated claim, honest policyholders pay more than they should for insurance."
During his presentation, Mr. Dubin also made mention of the involvement of IBC's participation with law enforcement agencies in several recent fraud busts in the Greater Toronto Area. As a result of Project 134, three Toronto-area rehabilitation clinics were convicted of multiple Insurance Act offences with fines as high as $100,000 were imposed per conviction. In Project 92, members of a staged collision ring that operated across the Greater Toronto Area, were arrested and sentenced to lengthy prison terms. IBC estimates the impact to the insurance industry from the fraud flowing from the staged collisions could be as high as $25 million. Finally, as a result of Project 147, numerous charges were laid against individuals involved in nine alleged staged collisions that occurred in York Region along with suspected associated false medical billings from several medical rehab and assessment centres located in Brampton,Toronto and Mississauga. Many of the individuals involved in this prosecution are still before the courts.
"IBC has long advocated for increased penalties as a way to reduce organized fraud, and we continue to lobby for legislative changes that will increase the risk and decrease the profit associated with fraud," said Mr. Dubin. "Higher penalties and hefty fines are the right way to stop these criminals."
IBC and its members are committed to putting an end to insurance fraud by investigating reported crimes and educating consumers about the cost and consequences of insurance fraud. IBC hopes that by working together, the insurance industry, consumers and governments will make it more difficult for organized criminal groups to operate.
"It's important that we move forward from knowing about the problem to doing something about it," stressed Mr. Dubin. "The more people who become aware of fraud and report it, the more investigations can be undertaken to help bring insurance criminals to justice. We urge Ontarians to help fight insurance fraud by reporting any suspicious activity by calling IBC's confidential Tips Line at 1-877-IBC-TIPS (877-422-8477) or by going online at www.ibc.ca and following the links. Or they can contact the Crime Stoppers anonymous tips line at 1-800-222-TIPS.
About Insurance Bureau of Canada (IBC)
IBC is pleased to celebrate 50 years as a valuable resource for insurance information. Since 1964, IBC has worked with governments across Canada to make our communities safer, championing issues that directly affect Canadians and the property and casualty (P&C) insurance industry. IBC is the national industry association representingCanada's private home, car and business insurers. Its member companies represent 90% of the P&C insurance market in Canada. The P&C insurance industry employs over 118,600 Canadians, pays more than $7 billion in taxes and levies to the federal, provincial and municipal governments, and has a total premium base of $46 billion.
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