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Editor’s Note: The following article is presented in QUESTION(JCFR)/ANSWER(Di Liberto) format. All answers were taken directly from comments delivered by John Di Liberto during his presentation at the NICB Western Region membership meeting.
QUESTION: When ICPI and NATB merged, whose personality prevailed?
ANSWER: The personality of NICB is a combination, a corporate schizophrenia. I guess modern psychiatrists and psychologists would call it a multiple personality.
The two basic entities that merged into NICB each had their separate character and each has been maintained. I refer to the investigative services we perform on one side of the house and the information services we perform on the other side of the house.
Through an investigative force of 200 special agents in partnership with law enforcement offices, fraud bureau representatives, SIU personnel, and all members of the criminal justice system, we’ve gotten the job done.
QUESTION: The NICB’s published theft statistics look strong.
Just how well are you doing in this area?
ANSWER: Last year the NICB assisted in the identification and recovery of nearly 250,000 stolen vehicles valued at somewhere in the neighborhood of $1.2 billion. That is a nine percent increase from previous years. I think it is through such efforts that vehicle theft continues to decline as reported in national statistics.
The NICB, in partnership with law enforcement, has created a system, an information and communication system that identifies the stolen vehicles and promptly notifies those who need to know. We also go and get the vehicles when the opportunity arises. Joe Pierron, director of Latin American Operations, NICB, has made notable progress in recovering vehicles that have slipped outside of our nation’s borders. What he does is go and get them: down in Mexico, Central America and South America.
QUESTION: We know your focus and expertise reach far beyond auto theft. How is the NICB performing in other areas of insurance crime?
ANSWER: In 1994, we assisted in 4,200 prosecutable actions against insurance criminals for investigation across the country. The insurance industry and criminal justice system partnership continues to flourish. But so does insurance crime. We have worked many major cases.
In Pennsylvania – 11 individuals, including the president of a medical equipment company and two medical clinic owners, were indicted on federal charges after a joint investigation by the NICB and the Federal Insurance Fraud Task Force. As part of a staged accident scheme, it involved 134 fraudulent and inflated billings for medical treatment. There were 31 carriers involved.
In North Carolina – a chiropractor pled guilty to mail fraud and was sentenced to repay $1.5 million to insurers, proceeds from a 28-month period. This was the result of a joint investigation of NICB and the FBI.
We charged 57 individuals involved in a Georgia staged auto accident ring. This was a joint investigation between local law enforcement and the NICB. Fifteen insurance companies were defrauded of at least $1 million.
In Illinois – I had the pleasure of participating in a press conference in regard to an offshoot of the Kalaos family.
And in Texas – 12 individuals were indicted for allegedly staging automobile accidents in an attempt to defraud insurance companies of at least $1.4 million. The group operated medical clinics in NYC, LA, Phoenix, and Houston, at least. They created fraudulent medical records and insurance claims. We believe the perpetrators have filed an additional $6.8 million in suspect claims.
QUESTION: What are some of the efforts being made by the NICB in the international arena?
ANSWER: We have assumed a responsibility to advocate our cause beyond the United States. We have reached out because criminals, particularly those who organize criminal activity, have gone beyond the borders of this country. We have established relationships throughout the world. I’ve already referred to our efforts in Latin America. We’ve centralized all of our activities in dealing with Mexico, Central America and South America in NICB’s Latin American Operation headquartered in Dallas.
Our efforts go beyond recovering vehicles, although we do recover vehicles that otherwise would not be recovered, and that inures to the benefit of those who work for insurance companies. But we also participate with the Department of State and the international section of the FBI to establish relations with foreign countries. While Mexico has a treaty, the other countries do not. We are working on a mechanism in international law and on agreements that call for criminal prosecution and the return of stolen property to the rightful owners. And that is a major part of our activities, ones that would simply not get done without our participation.
In addition, we are assisting other organizations throughout Europe and throughout the world that are involved in doing the same thing we do in their own parts of the world. This also extends to organizations whose activities are related to ours. Countries we are working in cooperation with include Australia, Austria, Canada, Central America, the Czech Republic, Denmark, France, Germany, Great Britain, Hungary, Mexico, the Netherlands, Republic of Poland, Russia, Slovenia, South Africa, South America, Sweden and Yugoslavia.
QUESTION: Can you tell us a few of the specific programs that the NICB is involved in?
ANSWER: We are actively engaged in a variety of activities. We have taken the fight against insurance crime and vehicle theft international. We have also deployed resources, and this is a very important part of our overall mission, to train and support those who are involved in the activity with regard to vehicle theft and insurance fraud. We provide law enforcement support, training and financial support. We have also funded many major investigations which have resulted in prosecutions.
QUESTION: Is the NICB channeling resources toward education?
ANSWER: We actively participate in joint training and educational activities. We formed the SI Academy to meet the educational needs of increasing numbers of SIUs and it has been a rousing success, particularly when you figure that we started from ground zero only a couple of years ago. I think there is a listing of scheduled special investigation academies throughout 1995. And that’s not the end. We already have further similar types of activities on the drawing board, including one-day seminars on very limited issues and perhaps an advanced SIU Academy. These are some of the things that the industry asked us for and we were in the position to perform. We have assumed that responsibility and as successful as the SI Academies have been, I think the future will reveal many additional successes.
QUESTION: Given the advances in data technology, do you see the current breed of street investigators gradually turning into desk-riding computer sleuths?
ANSWER: This answer involves the other important side of NICBs personality. Looking toward the future, a choice could be made between our investigative activities and our informational activities. The database in the big box versus the man on the street. Having given consideration to both of these, I think that the future of this organization lies in performing both of these tasks. I think the database is a very important element in the fight against fraud. However, so are the people out on the street who support the database. They are out there daily, pounding the pavement, coordinating activities and working in conjunction with the industry’s efforts. NICB’s future plans include encouragement and strong support in both areas.
QUESTION: Technologically speaking, how is the NICB doing?
ANSWER: NICB’s information services are certainly behind the scenes, although I hope not very far. Data is a relatively new tool in the trade. It’s how we are learning to fight the fight today, in the nineties. Technology is simply helping human beings to communicate faster and more effectively. Today we have more than 5000 people linked together with NICB’s online information services. Representatives from fraud bureaus, law enforcement agencies, prosecutors and insurance companies from coast to coast exchange new information about insurance claims activity – daily, constantly and instantly. That is the tool we brought to the task.
QUESTION: How quickly are you adding new data?
ANSWER: Nearly 50,000 claims were added to the NICB database during 1994. This represented a 10 percent increase over 1993. The information may be used today, or maybe not for weeks or years, but it is there to enhance the database.
QUESTION: Is the NICB planning to link up with the health care industry for cross-sharing data?
ANSWER: As a matter of fact, that is a timely question. I was in Baltimore and Washington recently and, as luck would have it, the NICB and the National Health Care Anti Fraud Association share the same law firm as legal counsel. That seemed to be the closest parallel to our organization.
While they don’t have the resources we do, they do collect some data, at least among health care insurers and they also have good contacts. We are now trying to formalize the relationship that has been kind of casual in the past. We are also working very specifically with the FBI, who obviously crosses lines in their healthcare initiative, to find out how we can best work together. I think this is a great opportunity area for us because, particularly when you talk about workers’ compensation, it is driven by the medical profession, and I don’t think that physicians or other types of medical providers who perpetrate fraud will discriminate between workers’ compensation claimants and health insurance claimants. Future information sharing is an excellent area to look at and we are certainly exploring the possibilities.
QUESTION: How are your efforts in workers’ compensation advancing?
ANSWER: In 1991, less than 300 workers’ compensation claims were collected for database analysis and storage. In 1994, more than 6,000 questionable workers’ compensation claims were added to the database. I know the industry is particularly sensitive to that issue and we consider this area to be a priority.
QUESTION: What do you see as the end product?
ANSWER: We are trying to produce a breed of electronic detectives. Many claims representatives and SIU personnel are now empowered to probe that vast database of several hundreds of millions of records in a number of ways, including the tracking and monitoring of questionable claims. Hopefully we can identify and pursue those who are organized against the insurance industry in their criminal activities. We can now search on names, addresses, phone numbers, driver’s license numbers, pin numbers, tax IDs and social security numbers. An analogy drawn by one person talked of being on the information superhighway – and the fact that now we can maybe just about get on the on ramp. What we are hoping to do is get you right in the middle of traffic. Our home office folks back in Chicagoland are working on some really exciting enhancements to the database and to the process of using that database.
QUESTION: What enhancements might we expect to see in the future?
ANSWER: First of all, it is going to be faster. What once took minutes to read and evaluate will now take only seconds. We are becoming more efficient – no more scrolling from screen to screen to get information. It’s all right there – user friendly information that is able to bounce back and forth. The user can receive the data requested, plus, it’s more concrete. We are enhancing the information that is there in terms of what is provided. The user will see a little more history, a little more directly available detail. This can be used to pursue whatever opportunity might be identified. There is also ISIS, a major undertaking regardless of who undertakes it.
QUESTION: Will NICB be training users to take advantage of the new offerings?
ANSWER: Our effort is intended to improve insurance crime detection and prosecution. In the months ahead, we will be renewing our commitment to our communication and training obligation. Users of our on-line services currently need to know more and they need to do it better. We also want to reach the tens of thousands of those who should be using those services and for some reason or other are not. We have provided small things like bulletin boards to convey information that reaches beyond a suspicious claims area to information of general utility. We’ve included other features that have to do with federal, state, or local statutes and a variety of other bits of information. We are taking training to the street and attempting to reach claims officers and SIU units throughout the country on an individual instruction basis. These endeavors tax our resources substantially, but that is the way we think we can get people to use this very valuable tool.
QUESTION: Training is a massive job. How do you plan to implement this task?
ANSWER: I have established a policy to create a centralized regional training officer in each region, someone who will work full time on the training, both internally and externally. I think that will provide the kind of focus that is necessary. Listening to the insurance industry, that is what we heard was needed. And I see it as our unique opportunity to provide that benefit so you will hear more and see more of that as the months go by.
We also have several video training pools and turn-key training packages, some on disc. This is very new to us and we are doing some additional work on it. But I have asked our staff to explore all opportunities to get the education and training message out. They are looking at methods of training by computer, audio tape, video tape, live and in person and more. NICB has seen the need and now we want to satisfy that need.
QUESTION: How important is public awareness?
ANSWER: A Gallup poll suggests, and this is a study in which we participated last year, that more and more Americans are considering insurance fraud to be, in fact, a serious crime. This is expressed by a score of 8.9 on a scale of 10 points. They think it is a big deal, something we have known for a long time. I’m glad that they caught up with us. But it is important that we elevate the profile, not for our own good feelings about what we do, but because that is a method of attacking the problem in another dimension. It causes people to be sensitized, offended, to act against insurance crime that is perpetrated all the time. They do this by lending their individual support to those agencies which fight the fight and by respecting the effort that insurance companies perform. They also recognize that there is a NICB out there whose sole full time purpose is to combat the insurance crime that offends them and gets in their pockets.
QUESTION: Is this change in public attitude a result of all the media – 20/20, America’s Most Wanted, etc. – covering insurance fraud?
ANSWER: Much of the recent media attention directed at the insurance fraud problem has been related to the profile that we enjoy now. I am a little concerned that, as with many things in the popular eye, it may be fleeting. I’ve said several times, let’s make hay while the sun shines. But it is great to see and it is great to know that something in the neighborhood of 150 million people have some idea what is going on out there.
QUESTION: How can individual insurers help?
ANSWER: We are also providing a digital news service which will be available to member companies over the next several months. It is an on-line service which provides a publishing department the ability to download NICB supplied statistics, stories, updates and infographics for their use in advertising, internal publications or external publications. An aware consumer is a concerned consumer.
We are also launching an aggressive national publicity campaign and invite consumers to “Report the Rip Off” by contacting the NICB insurance crime hotline. There is great benefit in consumers knowing that 1-800-TELL-NICB is out there. And it does get results. People do call and things do happen.
QUESTION: How do you feel about the future of the NICB?
ANSWER: I am very proud. I am proud to be asked to take the NICB into the 21st century. I am proud to assume a leadership role in a leading organization. I am proud to represent a concerned industry, concerned policy holders and concerned citizens. And I am proud of those who fight the fight day in and day out, whatever role they play and for whomever they labor. And I say let the message be heard, far and wide, loud and clear.
Look out around the globe – here we come.
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