Methodology of Economic Crime week 7 discussions
Week 7: Week Seven - Class Discussion
|Only 200 words |
|Instructional Objectives for this activity:|
Explain the basic elements of real estate fraud, insurance fraud, and contractor fraud.
|The text mentions that many Americans do not consider insurance fraud to be a crime, and many also do not consider this a serious issue. Please respond to the following three prompts as part of your discussion of this topic. You must cite specific examples from the text to support your contentions.|
- Discuss your thoughts about big insurance companies and whether or not you feel they take advantage of consumers.
- Do you think insurance fraud is a serious problem or not?
- In what way can insurance fraud contribute to financial elder abuse?
Read the portions of Chapter 5, "Financial Elder Abuse," on pages XXXXXXXXXXand page 186
Read the portions of Chapter 8, “Insurance and Contractor Fraud,” on pages 263– 264, XXXXXXXXXX, and XXXXXXXXXX
What IS INSURANCE FRAUD
Fraud us defined as a deception for financial gain. Insurance fraud can be committed by individuals against insurance companies such as “padding” a claim for more than the actual amount of a loss or Faking loss entirely. However, insurance fraud can also occur against policyholders. When an unscrupulous agent or company sells a fake policy, a health care provider bills for services that aren’t provided, or an individual stage an auto accident to collect from another driver’s become injured because of these schemes. Since companies divide the costs of claims among policyholders, insurance fraud drives premium often severe. More than one-third of people hurt in auto accident exaggerate their injuries. This adds $13- $18 billion to America’s annual insurance bill.
Who Commits Insurance Fraud
Insurance Fraud in not a highly visible crime. Yet, it costs the nation billions of dollars every year. While many people view it as a white-collar crime, insurance fraud is far more pervasive. A series of focus groups and survey conducted by Polk- Lepson Research Group probed what motivates and what deters insurance fraud. The research, commissioned by the Pennsylvania Insurance Fraud Prevention Authority (IFPA), identified four population segments likely to justify committing insurance fraud:
- Person motivated by “monetary necessity.”
- People who consider themselves to be part of a larger group of “social victim.”
- Individuals who feel personally victimized and who are motivated by “anger.”
Insurance Companies/ Corporations
A group characterized as “economic sophisticates,” people who seek to obtain and maintain wealth and who view fraudulent behavior as calculated risk.
Reporting the loss of property from a burglary that never occurred.
Life Insurance Fraud
Sliding: An insurance agent sells an unsuspecting consumer much more coverage than is needed.
Twisting: An insurance agent replaces a consumer’s policy with a new, more expensive one without their permission and pockets the additional premium.
Fraud committed by care-givers:
Relatives and care-givers often hold a position of trust with the elderly, and have generally
developed and maintained a relationship. They exploit the elderly through various means,
including taking money, property, or other valuables for personal use without the knowledge or
consent of the elderly person. These can also include borrowing money and items without
paying or giving it back, forging retirement checks, stealing items of value, and coercing or
tricking the elderly into signing over property.
Fraud committed by strangers:
Fraud by strangers typically involves deliberately deceiving the victim with the promise of
goods, services, or other benefits that are nonexistent, unnecessary, never intended to be
provided, or grossly misrepresented. The frauds typically occur within a few interactions.
Offenders generally use a small subset of frauds against the elderly, including prizes and
sweepstakes, charity contributions, loans and mortgages, health remedies, and confidence games.
INDICATORS OF FINANCAL ELDER:
Crime prevention efforts have identified a number of warning signs and indicators of booth consumer fraud and financial exploitation.
Means of committing the two listed separately
WARINING SIGNS OF CONSUMER FRAUD:
Stacks of unsolicited mail
Unusual number of package
Excessive magazine subscriptions
Unsolicited phone calls
Difficulty covering basic expenses
Accompaniment of stranger to bank
Transactions elder cannot explain
INDICATORS OF FINANCAL ABUSE:
Recent acquaintance expresses interest in finance.
Relative or caregiver is overly interested in elder’s financial affairs
Relative or caregiver expresses concern or is reluctant to spend money needed for Medical treatment
Utility and other bills not being paid.
Elder’s placement, care, or possessions are inconsistent with the size of estate, does not give the elder message implausible explanations about finances.
Flax, Michael M. (2005). Economic Crimes (Criminal Investigations Series), Law Tech Custom Publishing, Inc.