Transcript CRIME AGAINST INSURANCES: A kind of Organized Economic Crime

Maximilian Edelbacher
 Speaker: Maximilian Edelbacher
 Studied Law at the Vienna University
 1972 – 2006 employee of Police,
Chief of Major Crime Bureau
 1995 - 2012 Lecturer at 3 Universities
 Since 2007: Special Investigator of AVUS
 Since 2008: Security Advisor to ACUNS
 Since 2010: Board member of the Austrian
Association of Criminal Investigators
 Since 2011: UN Representative of IPES
 Author of several books, specific articles
2
 1. Global Frame Conditions
 2.
 3.
 4.
 5.
 6.
of Fraud against Insurance
Fraud against Insurance
is OC and Economic Crime
International Dimensions
of Fraud against Insurance
Insurance Fraudster`s profile
Challenges of this Century
Are we prepared to react?
3
1. Global Frame Condition of
Fraud against Insurance
 It is estimated that about 80%
of Fraud against Insurance
happens just in local areas.
 World Economics are structured
internationally, therefore risks
and vulnerability by OC are high
 OC activities will become more
and more transnational using
economic principles.
4
2. Fraud against Insurance:
OC and Economic Crime
 In the book: „Crime against
Insurances“, 2008, Univ. Prof.
Michael Theil and I argued that
this kind of Crime is Organized
Crime and Economic Crime.
 Just now Criminals act rather
locally but show a tendency to
act more and more globally.
 Examples prove this thesis.
5
 Organized– & Economic Crime
 Organized Criminals of the fifth
generation of Mafia use all fields
of crime to maximize their income
(Statement of Arije Antinori, Univ.
Prof. at the Sapienzia University in
Rome).
 Therefore OC, White Collar Crime,
Financial Crime, Money Laundering
are main income sources.
6
 Fields of Organized Crimes:
 Trafficking of Human Beings
 Trafficking of Drugs
 Trafficking of Weapons
 Trafficking of Stolen Vehicles
 International Financial Fraud
 International Counterfeiting
 Corruption and Bribery
 Financing Terrorism
 Money Laundering
 Economic Crime like Insurance Fraud
7
www.mafia.ru
3. International Dimension of
Fraud against Insurance
 As borders are less controlled
criminals use this opportunity
much more efficiently for their
purpose.
 Governments and law enforcement
organizations are to weak to protect
societies against transnational crime.
 Trafficking of stolen vehicles,
stolen art-pieces and insurance
fraud are increasing each year.
9
Examples of Insurance Fraud:
 In Austria and Germany numbers




of theft of cars, burglaries are
decreasing, but insurance claims are
increasing.
Boat-Casco-fraudulant Claims
increased by more than 20%.
Fraudulant Liability Insurance
claims increase generally by 20%.
Fraudulant car insurance claims
increased by more than 100%.
The following example was reported
as an accident - not as murder case!
10
4. Insurance Fraudster`s Profile
 A practical analysis of insurance
crime cases covered up between
1978 and 2012 in Austria, Vienna,
showed that the majority of
insurance crime offenders are
amateurs:
 3 % are Terrorists or OC-Criminals
 12 % are more or less professionals
 85 % are amateurs
 It seems to be a realistic outcome
compared to other experiences.
14
CRIME AGAINST INSURANCES
 Nobody is hit
 Because a friend






personally
You pay all the time
and do not get
anything back
A claim was not
settled
It is so easy to cheat
Because there are
economic problems



advised me to do so
To take revanch
Because I wanted to
help a friend
Because everybody
does it
Because insurance
companies treat you
impersonally
Fraud is business
Why insurance fraud is committed
15
5. Challenges of the 21st Century
 White Collar Crime and Organized Crime
is very often sophisticated, criminals
are highly mobile, acting transnational,
professional, are advised by lawyers or
other experts, use modern technologies
and are focused on economic success
and driven by greed.
 Use of Internet leads to
Cyber Crime.
16
Main Security Issues are:









Burglary into flats and homes
Theft of Cars and parts of cars
Theft & Fraud in Transport-Business
Economic- and Financial Crimes
Financing Terrorism
Money Laundering
Management of Catastrophes
Cybercrime, Internet-Crime
Piracy, High-Jacking, Arson
17
6. Are we prepared to react?
 International Meetings of Law
enforcement agencies analyze
that we are not really prepared
for these new challenges.
 Especially education and training
methods are not efficient enough
to prepare officers to fight new
modi operandi of criminals.
 Lack of knowledge of culture and
language are mentioned too.
18
What can be done?
 Law enforcement agencies have to
educate and train their officers to
counter white collar crime and
insurance fraud.
 Example: In 2012 Austrian police
officers learned by a Bulgarian hacker
how expensive cars, like Audi, BMW,
Lexus could be stolen in less than two
minutes, just by hacking the onboard
computer.
 Activities of Police and Insurance
Companies have to be coordinated.
19
Insurance Companies
 It has to be known that repression
and prevention measures against
insurance fraud is a professional
corner stone of claims management
of insurance companies.
 The top management has to be
convinced that counter-strategies
are not only necessary, but a must!
 It is a fact that a high number of
fraudulent claims stay undetected!
 Complexity and Intensity of fraud
increases.
What about the protection of
personal data and privacy?
20
Conclusion
 Costs of undetected Insurance Fraud
are high and estimated to increase.
 There are concrete links between
OC, WCC and Insurance Fraud.
 Cooperation between Insurance
Companies, Insurance Fraud Bureaus
and Law Enforcement Agencies are
important.
 Use of “Best Practices” has to be
the goal of all repression- prevention
measures.
21
- Questions?
- Discussion?
Right on your side
Thank you for your attention
Mag. Maximilian Edelbacher
[email protected]