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Social Seen

SIU investigators capitalize on the very public face of some fraudsters.

August 26, 2010 Photo
The self-disclosing nature of social media—Facebook, YouTube, Twitter and LinkedIn, along with hundreds of less well known social sites and personal blogs—allows special investigative unit (SIU) professionals unprecedented access to the lives and actions of workers' comp and bodily injury claimants.

Perhaps mistakenly believing that their Internet "trail" is somehow private or off-limits, claimants sometimes allow friends or acquaintances to post incriminating evidence of fraud (or they may be unaware that such evidence has been posted). On some occasions, claimants may even post incriminating details themselves. Most often, though, they simply act as if they are oblivious to the fact that their real-world activities can be documented via the virtual world through an ever-widening network of Web sites.

Not surprisingly, especially in the last two years or so, social media sites and other Web sites that contain the claimant's name and leisure activities, memberships or other pursuits have become some of the most valuable new tools that SIU investigators have for assembling breakthrough clues that may lead to the discovery of definitive evidence.

Streamlining Claims Fraud Investigations
Before a workers' compensation or bodily injury claim is referred to an SIU investigator, the claims adjuster processing the claim will have noticed one or more red flags. Some of the most common include:
  • Unavailability by phone—This could mean the claimant is working elsewhere while claiming an inability to work, or is simply active when the injury is supposed to prevent activity
  • Alleging an injury soon after starting a new job or first thing Monday morning—This could mean the claimant was injured before starting the job or was injured over the weekend
  • Waiting several months after an accident to present a claim—Evidence supporting or undercutting the claim would then be nearly impossible to obtain
  • Claiming injuries inconsistent with the nature of the causal incident and immediately seeking representation by an attorney.

Once the claim is referred, an investigator will request basic information from various online background-check databases, such as LexisNexis, corroborating personal details and contact information. Next, the claimant will be matched with other claims in the Insurance Services Office (ISO) database to check for multiple claims or indicators of serial fraud. The investigator will tailor the search based on the initial red flag. If, for instance, the flag is that the claimant never answers the phone, the investigator will try to find out what activities the claimant is engaged in instead of being at home.

Field investigations have been the traditional method of tracking a claimant's activities. Those typically include setting up in-person interviews with both the claimant and any witnesses to the accident, and they often require a visit to the county courthouse to check its records for information about any civil or criminal matters. The investigator may also conduct a clinic inspection to be sure that any therapeutic modalities and medical tests billed were, indeed, completed at a legitimate facility. Additionally, the investigator may undertake surveillance by spending many hours outside the claimant's home or other places he is known to frequent, video recorder in hand.
Surveillance is the most time-consuming part of the investigation, and success often relies on being in the right place at the right time. This is precisely why social sites on the Internet have proven to be so valuable. As SIU investigators have learned over the past few years, by conducting a search of social media and other public Web sites before heading out to conduct surveillance, they can focus their efforts on a time and a place most likely to yield the results they need. This is far better than relying on a hit-or-miss strategy or catching a brief glimpse of the claimant after spending days tailing him.

That said, many social media sites have built-in privacy safeguards that prevent investigators from accessing a suspect claimant's pages or profile, and breaching that barrier would be against the law. Not everyone activates the privacy features on their Web site pages, but when they do, investigators must look for access indirectly—by searching for communication between the claimant and friends or relatives posted on sites with greater access. Associates of the claimant may be found in the material submitted by the claimant's attorney when demanding payment for a claim. An investigator can also use information from the background search that was conducted at the beginning of the investigation to find the names of relatives, friends and business associates.

Hi-Yah!
An investigator takes a peek at an online martial arts video.

A claimant was at work when a 32-ounce hammer fell from above and landed on his safety helmet, resulting in a claim of a herniated disc in one of the vertebrae in his neck. "Tom" was diagnosed with a 20% permanent impairment in his cervical spine and a 15%-18% whole-body impairment. As a result, his doctors said he could be employed in a sedentary job only. But Tom remained unemployed, collected workers' compensation benefits, and filed suit against another on-site contractor, as well as the refinery itself. The refinery in turn filed suit against Tom.

Several years passed, and Tom claimed in his lawsuit that, even after this extended time period, he could no longer workout as he had done before the accident. But when he appeared for deposition, he was tan and looked very physically fit—unusual for someone claiming to be completely sedentary. Nevertheless, Tom was demanding a large settlement, and his trial date was set.

The claimant's apparent physical fitness did not go unnoticed, however, and his case was referred to the SIU to find out whether Tom was more active than he alleged. A comprehensive background check led to the discovery that Tom was more commonly known by his middle name, "Dillinger." Using that name, the investigator found two Web sites with videos of the claimant practicing martial arts during the period in which he claimed he could no longer workout or perform a job requiring physical exertion.

The defense counsel advised the plaintiff's counsel of the existence of these videos. After initial surprise, the claimant's attorney soon confirmed that his client was, indeed, the person in the videos and that he was practicing martial arts during the time he claimed an inability to workout. In the end, and as a result of the online video evidence, a much-reduced settlement was reached, saving several hundred thousand dollars. As is mandated in many states, the claim was referred to the fraud division of the state department of insurance.
I'm Not Buying It
An online sale item blows a claimant's cover.

On October 30, 2007, the claimant, "Jessica," alleged that she slipped and fell at an insured's location, resulting in injury to both her wrist and head. A month later, when the claimant was reluctant to meet with the claims adjuster for an in-person interview, her case was referred to the SIU for further investigation. A background check using the name that the claimant had provided revealed no positive identity information. Searching with Jessica's telephone number instead, the investigator found an item on an online buying site that advertised household items for sale. He made telephone contact with the seller, Jessica herself, and obtained an address where he might see the items for sale. This address was different from the one she had provided on her claim form.

A subsequent ISO search located another claim for the same injury, submitted on October 29, 2007, under a different claimant name. When Jessica again refused to meet for an in-person interview, she abandoned her claim at the same time.

Social media and other Web site mining has proven itself to be an extremely useful new tool for three reasons: When evidence is found, it:
  1. Instantly helps corroborate that the initial suspicions have merit
  2. Enables investigators to narrow their surveillance and investigation efforts to a specific time and place where a claimant is likely to engage in "off-limits" activity that can be documented
  3. Provides easily accessed documentation of claimant activities and lifestyles that can be used to persuade claimant attorneys that their clients may not have been completely forthcoming—thereby opening the door to negotiation.

At the same time, the mining of Internet sites is never used as the single method to mitigate or deny a claim. Investigators must always create their own surveillance videos or other evidence to achieve those goals. Nevertheless, social media and other claimant-relevant sites can provide investigative leads that make the discovery of definitive evidence both far more likely and less time-consuming than it otherwise would have been.
Alfred J. Marrazzo (alfred.marrazzo@acegroup.com) is the SIU Manager of ESIS Inc.'s Anti-Fraud program. He has more than 31 years experience in the anti-fraud and special investigation management arena.

See You Saturday
A motorcyclist invites the investigator to bust him.

One simple example of how Web mining works is that of a claimant who posted public messages on his Facebook page about participating in an upcoming motorcycle rally. Not only did this tell the investigator that the claims adjuster's suspicion about this case had real merit, it provided information about the best time and location for surveillance of the claimant riding his motorcycle—something his claim indicated he was unable to do.

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