Investigation Case Study

Gary Sommerford, MInstLM, GCGI, ACFS

counter fraud, risk, investigations & cost containment solutions

Scenario

Subject had accident in Mykonos

Severe abdominal injuries resulting in emergency evacuation to Athens

Initially admitted to public hospital

Transferred to Private Hospital

€600,000.00 Bill

Timeline

05/07/2012 – Agent advises that subject was involved in RTC on 20/06/2012

Agent requested LoG for €100,000.00 for Private Hospital

17/07/2014 – Insurer unable to contact family Insurer requested medical reports, police report,

itemised costs & estimate of further costs

01/08/2012 – Med Report and expenses now €250,000.00

13/09/2012 Subjects wife contacts insurer advising that husband had been involved in RTC and was in Private Hospital ICU – Payment of bills

requested

Constant pressure from Private Hospital for insurer to provide LoG

Timeline16/10/2012 Subjects wife contacts insurer

advising that husband had not been involved in RTC and had in fact fallen on a construction

site

07/11/2012 – New Medical Report provided by Private Hospital

12/12/2012 – Subjects lawyer contacts insurer requesting payment

Insurer agent meets with subjects wife – During this meeting agent was notified of potential

significant reduction in bill by Private Hospital

Potential witness identified – Constructor (Uninsured as not required in Greece) Confirms

injuries sustained as a result of fall on construction site

ConcernsCircumstances

Conflicting Accounts

Differing medial opinion on potential cause of injuries

Lack of information

Transfer to Private Hospital & Unmanaged Costs

Memory Loss of subject

Coverage?

Subrogation?

Fraud?

Scope and Objectives

Establish the circumstances of the accident

Establish actions of all concerned

Establish comprehensive timeline

Interview witnesses

Recover medical records and other documentation/reports

Establish evidence of fraud

Establish potential for subrogation

Consider reasonable and customary costs

Conduct of Investigation

Desktop enquiries & fieldwork

Local agents

Interpreter

Translator

Witnesses

Police

Public medical providers

Private medical providers

Conduct of Investigation

National Centre of Direct Help (EKAB)

Hire Companies

Greek Insurance Association

Local independent medical professional

Scene

Photographs

Video

Result of Investigation

20/06/2012 – Subjects wife advised of road accident by constructor and that

subject was to be transferred to Athens

20/06/2012 – Agent received a phone call from subject requesting help as he

was ‘dying’.

Agent subsequently spoke with constructor who advised that

assistance was needed transferring subject to Athens – Emergency Assistance number provided

Agent also called number but it was not working!

Result of Investigation

MykonosSubject went to public clinic and discharged with minor injuries

Subject then went to private clinic where he was diagnosed with serious chest and abdominal injuries requiring

evacuation to Athens

Unable to arrange private transfer either through insurance or personal

finances

EKAB – Via public clinic who were advised evacuation only

Result of Investigation

Mykonos

Enquiries with the police established that there had been no reported traffic

accidents on or around the day in question and no reports bearing the

name of the subject

Enquiries with hire car companies established that there were no

reported traffic accidents on or around the day in question and that the subject had not hired a vehicle

Visit to the scene

Result of Investigation

Mykonos

Local enquiries established knowledge of an accident at the scene where the subject had ‘fallen down some stairs’

Attempts to liaise with the only witness (Contractor) proved negative. His

daughter advised that he had travelled to his native Albania

Contractor was seen on by site witnesses whilst he investigator was in Mykonos - Family advised of a dispute

with the contractor over money

Result of Investigation

Greece

Documentation recovered from public hospital – Established subject spent 24 hours in hospital before being operated on - Following surgery, there were no

beds available in ICU

Subject transferred to private hospital ICU

Meeting at private hospital – Recovered documentation and established that

legal proceedings had been commencedSurgeon advised that report had been

amended after being advised that initial report was incorrect

Result of Investigation

Greece

EKAB – National Centre of Direct Help

In circumstances where no public ICU available EKAB must be contacted in

order to allocate an alternative in another public hospital. Only if this

option is unavailable will a patient be moved to private hospital.

EKAB confirmed that they had been contacted and that there were no ICU

beds available in any other public hospital

Result of Investigation

Greece

GIA – Greek Insurance Association

No obligation to have and private insurance for third party liability

Owner is to have insurance in place for any civil engineer and construction staff

Civil engineer must be insured

Subject was both owner and civil engineer – Uninsured!

Result of Investigation

Reasonable and Customary Costs

Independent medical auditors evaluated invoices from private hospital

Doctors fees approx. 5% higher than customary

All other costs in-line with similar hospitals in Athens

No evidence of overtreatment or unnecessary tests

Result of Investigation

Legal proceedings by private hospital against subject

Legal proceedings by subject against public hospital for misdiagnosis and

delaying treatment

Insurer savings as a result of investigation approximately €500,000

DYSTICHIMA / ATICHIMA

ΔYΣTYXHMA / ATYXHMA

Investigation

A searching enquiry for ascertaining facts

Detailed or careful examination

Minute and thorough attempt to learn the facts

FOS – Financial Ombudsman Service

Dim view of insurers who, through restrictive use of policy exclusions,

implied that people were expected to refrain from drinking on holiday if they

wish to remain insured

Increase in complaints about claims being declined

In many cases insurers assumed alcohol had been a factor

Evidence

Why Appoint an Investigator

Fieldwork is vital

Remote communication would not have provided the same detailed information to enable confident informed decisions

to be made

Independent

Open Minded

Qualified and experienced

Evidential Standards

BS 102000 – Code of Practice for the

Provision of Investigative

Services

licensing of Investigators

Private Security Industry Act 2001

investigator

compliance

competence

investigative service

ANY QUESTIONS

?counter fraud, risk, investigations & cost containment solutions