James and Betty have a busy life. He owns several catering businesses and she owns a nail studio. They bought a spacious farmhouse, beautiful cars and valuable items and jewelry. In November 2012, there was burglary. According to the claim form the couple submitted to the insurance company, the thieves took jewelry, computers, photo and audio equipment and a pair of special Prada glasses. Their claim was for an amount of almost USD 35,000.
The insurer’s loss adjusters visited the couple to discuss their claim. The couple could provide supporting photos and invoices for most of the items that were claimed. But they were unable to do so for a second pair of Prada glasses. This was odd since James was wearing this brand of glasses during the visit. The loss adjusters decided to investigate further because the Fraud Registration System showed that the couple had previously submitted another claim for theft. They discovered that burglary damage of USD 30,000 had been investigated and remunerated by another insurance company three years earlier. It was striking that various items of jewellery claimed at that time were being claimed again using the same invoices. Further investigation showed that various invoices didn’t add up. James admitted that after the first burglary he had claimed items that had not actually been stolen and that he had submitted claims the second time for some of the items stolen the first time. The pair of Prada glasses had not been stolen and were still being worn.
Although it appeared on the surface that the entrepreneurial couple were very successful, in reality their businesses were doing badly and they had sizeable payment arrears for their extremely high mortgage as well as a high tax debt. In order to meet these payments, they had submitted claims of at least USD 275,000 with insurance companies.
It cannot be shown (as yet) that each claim is fraudulent. But this was certainly the case with the claims in this FraudStory. The previously paid amount of USD 30,000 was recovered and the claim that set the ball rolling was rejected. The investigative costs incurred were also charged to the couple. In addition, a report was filed with the police and James and Betty were included in the Fraud Registration System. The insurance companies will probably be left with a loss since, in view of the financial situation of the couple, it is unlikely that any of the insurance money wrongly paid will be recovered.