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It’s a bittersweet victory when I suddenly become cognizant of a great truth that’s been right in front of my nose. On the one hand, there is disappointment that it took so long to figure out whatever it is; but on the other hand, there is relief that it has, indeed, finally been figured out.
I recently “did” one of the network TV talk shows in New York. The topic was, of course, fraud, and I was there in the capacity of an expert on the subject (somewhat of a fraud in and of itself because I don’t believe there are any true experts in this field.) Included on the panel were two individuals who were also billed as fraud experts but from the other side of the fence. Each was a fraudster who’d taken industry for large amounts of money, but who was now “reformed.” (Read: eventually got caught, did time, and was on strict enough probation that their noses were probably clean since each had been released.)
One was a slip and faller (let’s call him Ralph) who admitted to over 200 staged claims. When video clips were shown of another fraudster staging a tumble in a supermarket, with the whole thing caught on the in house security camera, Ralph rather proudly pointed out that the faller was an “amateur” and obviously not “professional” (Read: smart!) like himself. Having just spent nearly an hour backstage chatting with Ralph, I had a sudden realization. Ralph, like a million other crooks, believed that his success with fraudulent claims was because he himself was smart. But he wasn’t particularly smart at all. In fact, intelligence wise, I’d figure him to be somewhere in the 100 to110 IQ range, average to slightly above average.
So why did he get away with 200 bogus slip and falls? (Now here comes that great truth I spoke of…) Probably not because he was, as he perceived himself to be, “smart,” but because the collective insurance industry was not educated enough or even willing enough to catch him.
Ralph always used his own name for his claims. He always settled fast, usually within ten days and sometimes within mere hours. The only truly “smart” thing he had figured out was that the insurance industry is greedy, too. He told me that if he needed a quick $1500 to go on a slip and fall road trip, he’d go to the local bus station, stage a fall, and have a $1500 settlement from a certain three letter adjustment firm in less than 24 hours. “All I had to say was that I had radiating pain down the back of my leg,” he told me, “and they couldn’t wait to hand me the $1500 and get me to sign on the dotted line.”
So what’s the bottom line here? It’s not a matter of how smart they are, it’s a matter of how smart we are.
The John Cooke Insurance Fraud Report
“Fighting fraud through communication and education”
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