NICB: Where Storms Hit Fraud Often Follows

For Unsolicited Repairs, If You Didn’t Request It — Reject It

Disaster-Brochure-CoverDES PLAINES, Ill., April 16, 2014 — As the traditional storm season approaches, the National Insurance Crime Bureau (NICB) and its nearly 1,100 member insurance companies are warning consumers to ensure that they have a disaster plan. By taking precautionary steps to ensure their personal safety, as well as to protect their property, people can greatly reduce the risk of injury. Having food and water sufficient for your family’s needs for at least three days is recommended, as is having a battery-powered or hand-crank weather radio.

While personal survival from a storm or other natural disaster is paramount, consideration must also be given to surviving one financially if your home is damaged or destroyed, and that is most effectively provided through insurance. However, many times disaster victims fall prey to predatory and fraudulent repair scams perpetrated by individuals looking for a fast buck, usually at a victim’s expense.

Read the full press release.

Watch the video.

Florida’s No-Fault Reform: Trending in the Right Direction

After Leading the Nation with Suspicious PIP Claims, Florida Sees a Decline

Florida PIP ReformThe National Insurance Crime Bureau (NICB) has released a new report revealing a decline in Florida’s personal injury protection (PIP) questionable claims (QCs). In 2013, Florida PIP QCs declined by 7.6 percent from 2012. Meanwhile, for the period 2010 through 2013, Florida staged accident QCs decreased by 61.82 percent.

Tighter legislation, enhanced public awareness and a coordinated law enforcement response appear to be having the intended effect on PIP fraud in Florida.

We are encouraged by the decline in questionable claims that we’ve seen recently, but by no means are we declaring victory in Florida,” said NICB President and CEO Joe Wehrle. “Florida remains a hotbed for fraudulent activity, and we can’t afford to ease up for a moment in our fight against those who would abuse the system and burden Florida consumers.”

Visit the NICB Newsroom to read the full press release.

NICB Urges Minnesota Lawmakers to Turn Up the Heat on Insurance Fraud

Proposed legislation is essential tool for fighting no-fault crime

MinnesotaEffortsDES PLAINES, Ill., Feb. 13, 2014 — At a news conference at the Minnesota Capitol Thursday, the National Insurance Crime Bureau (NICB) expressed its strong support for the efforts of the Senate Commerce Committee’s Working Group on Insurance Fraud. The group has spent the last nine months taking testimony about insurance fraud’s impact on the state and is introducing a legislative package to combat the problem.

The reform efforts are an outgrowth of the 2012 Insurance Fraud Summit sponsored by the NICB and the Insurance Federation of Minnesota, which highlighted the increases in no-fault auto insurance fraud and other insurance fraud schemes in the state over the past few years.

Read the full press here.

For video highlights of the news conference, click here.

All Aboard: The Significance of a HIN

It’s January. Right now, most of the country is hunkered down by the snow and blistering cold. For most of us in the colder regions of the country, warm weather may seem like the distant future. But regardless of where you reside, if you enjoy outdoor activities on the water, there’s something you need to keep in mind.

BoatShow1Recently, I joined colleagues from the NICB’s Manufacturers Information Group at the Boat, Sports & RV Show at McCormick Place in Chicago. The annual event is billed as a one-stop marketplace and provides outdoor enthusiasts and dreamers alike an opportunity to see the latest and greatest offerings. Prices run the gamut from a few thousand dollars to several hundred thousand, or over $1 million. Other watercrafts such as kayaks or Jet Skis offer an even lower price point.

But why is the NICB concerned about boats and other watercrafts, you might ask? Because, like many other investments and property, they may be targets for thieves and fraudulent schemes.

While the typical visitor may have been touring the boats in search of deals and features, we toured them in search of HINs (Hull Identification Numbers). Similar to automobiles, boats also have identification numbers placed on them by their manufacturers. These HINs contain characters and numbers, information that assists law enforcement in recovering stolen boats. Since August of 1972, every marine vessel that is made or imported for sale in the U.S. is required to have a HIN. We wanted to see where and how these HINs were placed, not for aesthetic reasons, but rather to assess how easily thieves might possibly remove or alter them.

A 2013 report by the NICB indicated that there were 5,780 watercraft thefts reported in 2012. That equates to about 16 thefts per day with the spring and summer months having the most active periods for thefts. So what, if anything, can be done to help guard against theft and fraud schemes?

The NICB and NMMA (National Marine Manufacturers Association) have partnered to create a boat database to enhance the efforts of the United States Coast Guard, law enforcement and NICB personnel to identify thefts and related fraudulent schemes.
Currently, the database contains over 661,000 boat records received directly from the boat manufacturers. Data collected include: year of manufacture; hull identification number (HIN); brand; model; length overall; hull material; propulsion type; fuel type; and vessel type. For investigative assistance, NICB Member Companies and law enforcement partners are encouraged to contact the NICB’s Investigative Assistance Group at 1-800-447-6282 x7002 or 847-544-7002.

For consumers, whether you spend $1,000 or several hundred thousand for your boat, it’s more than just a recreational craft. It’s an investment. Like any other investment, you need to protect it from theft. For more information on how to protect your boat, the NICB offers these helpful tips and video.

NICB Employees Giving Back to the Community

PantryDonationCFood pantries are vital resources for countless families and individuals who have been impacted by a challenging economy or struggle with poverty. A special thank you is extended to NICB employees whose generous donations of canned goods and other food items help to combat hunger.

Numerous NICB employees volunteer their time and actively support many charitable organizations throughout the year. It’s no wonder then that some HQ employees became involved with the local Self Help Closet and Food Pantry here in Des Plaines which reportedly serves on average about 1,000 persons per month.

The food box to help the Des Plaines Self-Help Closet and Pantry first showed up in the NICB lunchroom around 2009. It was around the time the economy wasn’t fairing well, and the food pantry donations were slowing down. We wanted to help the community we were fortunate to be working in by giving back! It is gratifying to see our donations put to good use immediately.” Anna K., NICB senior tactical analyst

I’m very happy to bring the food items to the pantry on behalf of NICB, as it gives me the feeling of “pitching” in as a team to assist those who are less fortunate.” Donna W.,NICB  training associate

Thank you Anna, Donna, and all who have provided their support over the years.

Omaha Man Reunited with Motorcycle Stolen 46 Years Ago

MotorcyclePostThousands of motorcycles are stolen in the U.S. each year, and fewer than 40 percent are ever recovered. So when a motorcycle has been missing for 46 years, well the chances of it ever showing up again are slim.

But don’t tell that to Don Devault. His 1953 Triumph motorcycle was returned to him this week in Omaha, Nebraska – the same place it was stolen in 1967, when Don was 27. The recovery was one of the more interesting challenges for Lou Koven, a special agent with the National Insurance Crime Bureau. He works with Customs and Border Patrol’s Sami Nasri and the California Highway Patrol’s Mike Maleta at the Port of Los Angeles and Long Beach. They checked on the bike when it was about to be loaded on a ship to Japan. The VIN number showed up in NICB’s historical database of stolen vehicles and Koven tracked it down to a police report from Omaha. That led to Devault — now 73 — still riding motorcycles and never expecting to see that bike again.

Local trucking company owner Marty McMullen took care of getting the bike back to Don, hiring a driver to pick it up in California and bring it home. Special Agent Koven was on hand to see it arrive and meet the man who didn’t believe him when he first called to tell him his motorcycle had been recovered.

When it was stolen, Devault valued it at $300. It’s now worth an estimated $9,000 and Devault plans to hold on to it this time.

For a complete report, watch this video.

Anyone with information concerning insurance fraud or vehicle theft can report it anonymously by calling toll-free 800-TEL-NICB (800-835-6422), texting keyword “fraud” to TIP411 (847411) or submitting a form on our website. Or, download the NICB Fraud Tips app on your iPhone or Android device.

About the National Insurance Crime Bureau: headquartered in Des Plaines, Ill., the NICB is the nation’s leading not-for-profit organization exclusively dedicated to preventing, detecting and defeating insurance fraud and vehicle theft through data analytics, investigations, training, legislative advocacy and public awareness. The NICB is supported by more than 1,100 property and casualty insurance companies and self-insured organizations. NICB member companies wrote $350 billion in insurance premiums in 2012, or more than 78 percent of the nation’s property/casualty insurance. That includes more than 93 percent ($160 billion) of the nation’s personal auto insurance. To learn more visit

Like This. Rethinking Social Networks and Fraud Awareness in the Era of Generation Y.

SocialMediaAs an Investigative Assistant at NICB, I provide assistance to NICB Agents, member companies, and our law enforcement partners in the fight against insurance fraud. Each call that I receive can be vastly different. It’s a stark reminder that new types of fraudulent schemes are emerging on a daily basis. Armed with this new knowledge, it has caused me to reconsider how I use social media.

When I first joined Facebook, it seemed like an exclusive club that was only open to those with a college email address. Its exclusiveness made it feel a lot safer than its counterpart MySpace, which was open to anyone. However, after a while Facebook dropped its college-only status and opened itself up to anyone with a computer. With the openness of social networks such as Facebook, the current generation has to be careful of what information it shares with the social media world.

There seems to be a common misconception among my generation, Generation Y/Millenials; it’s the idea that we are in control of who sees our information. We create a password, handpick a mere 865 friends, and set our profiles to “private.” Yet we are still at risk of having our information shared with people we don’t know. Today, all someone needs to do is take a screenshot of that embarrassing picture or any other private moment that you’ve posted on Facebook and send it to five of their friends. Poof! That security wall that you thought you put up has suddenly come tumbling down.

Unlike previous generations, we seem to be more willing to share our daily life with people we barely know, thereby putting ourselves at risk for all types of danger, including identity theft and other fraud schemes. Over sharing is a serious problem. Aside from the host of potentially unflattering pictures of inappropriate behavior that we may post, we’ve essentially given up control of our personal information to a website in hopes of showing other people just how great we are doing. Well. How great are we actually doing?

As a user, I can’t pretend that I don’t appreciate the benefits that social platforms like Facebook provides me to keep in touch with friends. I do love those wedding pictures from my grammar school classmates. Like many other users, I also wonder what these people have been up to since we last saw each other, often so many years ago.

I have also found many new organizations to support that I otherwise would not have known about due to the location or just plain lack of information. Like many of my contemporaries, I usually receive my world news by my custom select newsfeed. Newspapers? Not so much. And yes, I’m more likely to use the search engine on my phone rather than grab a chunky phone book. Do they even print those anymore?

But I still have to wonder, at what price does this benefit come? Posting pictures of yourself engaging in inappropriate behavior can do more harm than just make you look bad to a potential employer. Tagging yourself in a certain location can make you more likely to have someone follow you. Putting on Facebook that you are going on vacation makes it easier for a break in to happen. All of these reasons are the downside of this new freedom my generation has created for itself. We seem to be quick to put out information to let people know everything about ourselves that we are willing to give up control of our private information.

So, is there a plus side to sharing? It has become a good ally in helping to combat insurance fraud. Ten years ago, law enforcement may have had to search for weeks to find information on a stolen car or for investigators at an insurance company to find evidence regarding a suspicious claim. Now individuals seem to willingly put it all out there on the social networks for the whole world to see. With the click of a mouse, friends, strangers, and law enforcement can get pictures, advertisements, and even a confession of car thefts, break-ins and other illegal activities.

It will be interesting to see what the future of social media holds for not just Generation Y, but for all of us. As for me, I’m rethinking my next status update. LOL.

Thieves Turn Copper Theft into Gold

CopperIn California, thieves shut down numerous Web sites operated by state agencies when they ripped copper wire from a mile-long stretch of highway. In Illinois, a man was electrocuted as he attempted to steal copper wire from a live line. In Washington State, copper thefts near Seattle-Tacoma International Airport disabled the approach lighting for one of the airport’s runways.

After a rash of copper thefts from trucks carrying copper along Virginia highways, authorities in Virginia, working with NICB special agents, arrested a man at the center of the Virginia thefts.

All across the country copper thefts are making the news day after day and, in many areas, they are reaching epidemic proportions. As the market for copper fluctuates, so does the theft activity and in recent times copper has been worth the risk.

In some cases, the crimes are committed by drug addicts looking to get some quick cash. In other cases, the crimes are committed by organized groups or opportunistic thieves, such as employees of businesses that work with metal. Regardless of the motive, the damage caused by such thefts is often several times the value of the metal stolen, leaving the victims with hefty repair costs which are then often passed on to insurance companies.

The U.S. Department of Energy has estimated that metal theft costs U.S. businesses around $1 billion a year. Some states and cities have taken measures to combat metal theft, such as requiring scrap yards to check identification of any individual who sells them scrap metal, note the license plate of the vehicle used to transport the metal, maintain the information on file, pay the seller with check instead of cash, or retain the scrap metal for a designated amount of time to allow law enforcement an opportunity to identify stolen materials before it is recycled.

However, identifying stolen metal is not always possible and opposition to these laws from the scrap industry has made it difficult to get effective measures passed in some areas. Even in areas where such laws exist, some unscrupulous scrap dealers do not abide by them and enforcement of the laws has not always been a major priority until recent years when increases in metal thefts brought more attention to the problem. Some states and local governments have increased the penalties associated with metal theft, or are charging thieves with additional crimes if the theft caused damage to infrastructure or created a hazard to the public.

From January 1, 2010 through December 31, 2012, NICB analysts identified 33,775 insurance claims for the theft of copper, bronze, brass or aluminum—32,568 of them (96 percent) for copper alone. This shows a 36 percent increase in claims when compared with the 25,083 claims reported between Jan. 1, 2009, and Dec. 31, 2011.

Ohio ranks first among the top five states with the most insurance claims for metal thefts followed by, in order, Texas, Georgia, California, and North Carolina.

Although communities are cracking down on copper thefts, it remains a significant problem across the nation. Hopefully, with enhanced awareness and reporting of suspicious activity, ordinary citizens will help reduce these thefts.

Representatives Allege Kickback Schemes and Fraud are Growing Trend under Minnesota’s No-Fault Insurance System


The outcome of a pending lawsuit in Minnesota may serve as a catalyst for reform for the state’s current no-fault law. In the upcoming litigation that will likely draw additional attention and increase awareness of flaws within the existing system, Illinois Farmers Insurance and its subsidiaries filed a $1.9 million lawsuit against Mobile Diagnostic Imaging, Inc. (MDI), its owner, and 46 chiropractors. The diagnostic imaging company and the chiropractors are allegedly engaging in an elaborate kickback scheme to defraud the state of Minnesota’s no-fault insurance system. Under the state’s current system, the law requires insurance companies to pay a minimum of $20,000 for medical expenses, regardless of who is at fault in an auto accident.

While the goal may have been to provide personal injury protection for Minnesota motorists, according to local insurance representatives, there appears to be a growing trend in kickback schemes and staged accidents to commit fraud by taking advantage of the state’s no-fault law.

The lawsuit filed against MDI alleges that the company’s owner, Michael Appleman, paid 46 chiropractors kickbacks for ordering MRIs, many of which may not have been medically necessary. It is further alleged that MDI conducted its scans in a self-sufficient MRI trailer and that $221,800 in kickbacks were paid to the chiropractors between January and November of 2011.

Mark Kulda, a vice president of public affairs for the insurance federation, was quoted in the Star Tribune article regarding the case, “Today’s filing of a federal lawsuit reaffirms what our industry has been saying for several years now – that insurance fraud is rampant in Minnesota.”

NICB’s Government Affairs department will be closely following the case as it progresses. As the legislative advocacy arm of the organization, the team promotes statutes, regulations and policies at all levels of government to help serve member interests in preventing, detecting and defeating insurance fraud and vehicle theft.

TimContact3Tim Lynch, a director of government affairs at NICB, says “Unfortunately, Minnesota’s no fault system has been hijacked by some dishonest medical providers, paid intermediaries and unscrupulous attorneys that have turned the system into their own personal treasury. NICB is actively working with the Minnesota Senate Working Group on Insurance Fraud to pursue some anti-fraud firewalls and controls to the current system.”

To join the conversation on stopping fraud in Minnesota, check out the Stop Fraud MN Facebook page. For additional information on NICB, visit us online at To contact Tim Lynch, email him at

Are More Federal Prosecutions of Medical Fraud on the Horizon?

In his address to the American Bar Association’s House of Delegates on August 12, United States Attorney General Eric Holder caused quite a stir when he announced more restrictive guidelines for federal drug prosecutions. Specifically, he has directed that “certain low-level, non-violent drug offenders who have no ties to large scale organizations, gangs, or cartels will no longer be charged with offenses that impose draconian mandatory minimum sentences.”

While some people have complained that Holder was “retreating” on the war on drugs, Holder also recognized the burden that state criminal cases have placed on the federal system—a system never intended to address state crimes the way it has with the advent of the war on drugs—a war that was reinvigorated in the 1980s.

Law enforcement officers at the state and local level were bringing low-level drug cases to federal prosecutors solely because of the severity of the sentencing possibilities. That, coupled with the expansion of drug task forces around the country, increased federal prosecutors’ caseloads and prison populations. Currently, almost half of the 219,000 federal prisoners are incarcerated for drug violations.

So how does this impact insurance fraud?

When Holder said later in his speech, “It’s imperative that we maximize our resources by focusing on protecting national security; combating violent crime; fighting against financial fraud; and safeguarding the most vulnerable members of our society,” he was recognizing that financial fraud is a serious and growing crime that deserves continued federal attention.

Indeed, the Healthcare Fraud Prevention Partnership was formed last year by AG Holder and Health and Human Services Secretary Kathleen Sebelius to unite public-private entities in the fight against healthcare fraud. NICB CEO Joe Wehrle sits on the Executive Committee along with representatives from the health insurance industry, federal agencies, state regulatory bodies and anti-fraud associations.

There is no question that it has been difficult, at times, to get a prosecutor to bring a case against an insurance fraudster. Even the most air-tight insurance fraud investigative package is useless if a prosecutor declines to advance it. Many times those declinations are based on local guidelines or resource limitations. AG Holder’s remarks provide all of us in the insurance fraud fighting community hope that going forward, more serious cases of medical insurance fraud—the most damaging and egregious ones—will be prosecuted at the federal level.

Only time will tell, but one thing is certain—the environment for prosecuting insurance fraud is becoming more welcoming than it has been for some time. And that’s a good thing.