Anthony Van Gorp on “How to Prevent Fraudulent Workers' Compensation Claims” (Podcast Transcript)
President & Founder, Investigative Solutions, Inc.
The following podcast transcript is the second in a series of four webcasts on “Risk Management Strategies in a Weak Economy”, hosted by Arthur J. Gallagher Risk Management Services. To listen to the podcast for free, go to http://www.workerscompkit.com/gallagher/mp3/.
© Copyright 2009 Arthur J. Gallagher Risk Management Services, Inc. All Rights Reserved. Reprinted with permission.
[Note: This transcript was partially edited.]
Ed: Welcome everybody to Risk Management Strategies in a Weak Economy Webcast, Special Investigative Unit. I'm your host, Ed Zabinski, a safety consultant at Arthur J. Gallagher Risk Management Services. This is the second in a series of four webcasts on this topic. The previous session was on legal strategies. In this webcast Anthony Van Gorp, a private investigator at Investigative Solutions, Inc. is going to talk about what a company should be aware of and can do to prevent fraud and theft. Here is today's disclaimer. It appears in all webcasts for Arthur J. Gallagher Risk Management Services. Anthony Van Gorp is a private investigator for over 28 years for businesses, individuals, insurance carriers and Fortune 500 companies. His professional experience and approach to fraud prevention makes him a much sought-after speaker.
I'd like to start the presentation by asking the audience a polling question just to get things going here. And in this polling question I'd like to ask everyone: At your company, what percentage of workers' compensation claims do you feel or believe are fraudulent? Here we go. Broadcast results. There’s the result for everyone to see. Tony, I'll turn it over to you.
Tony: Real good. All of us in the insurance industry are dealing with a lot of different issues currently with the economy, with the different financial situations going on, and the one thing I do want to assure you, I spent 7-and-a-half years at CNA, so I do understand your pain. I know the file volume is probably real high right now. First thing I want to do is – the first slide, let me get to that – the current environment. I don't know how many of you have actually gone and seen the movie regarding John Dillinger, but there's one scene in the commercial. It portrays John Dillinger in this bank, and there's this poor farmer man, and he says, "Is this your money or the bank's?" And the guy says, "Well, that's my money." The guy says, "Keep it. We don't want your money." I think one of the things that we're dealing with people, and we'll talk more about soft and hard fraud, but how do you differentiate between it's the bank's money or it's a person's money? How do you differentiate between good fraud and bad fraud? I don't think we can do that. So what we need to do is drill down a little deeper and start looking at the problem. One of the problems I think we're dealing with is public attitudes towards fraud. You know, people are finding themselves in more difficult situations financially. They're finding themselves being laid off, reduced hours. And that plays a big part in how people respond to current situations in fraud. I'm not condemning‑‑ I'm condemning fraud, obviously, but I'm not condoning people's choices. I am trying to establish the fact that they're affected by the environment at times.
Surveys show that 24 percent of Americans believe that it's all right to overstate their insurance claims. Basically, their car is stolen and there were two sets of golf clubs as opposed to one set of golf clubs. They're going to try to cover their premium in these types of situations. The number of Americans who think it's okay to pad a claim or make up a deductible increases about 22 to 40%. All of these numbers that I'm getting are from NICB and different fraud organizations. The thing I found over the years I've been in business is those numbers are usually pretty stale. They usually aren't real current. But the numbers I think reflect probably about the situation we're in currently.
First of all, what is fraud? I would imagine that most of us are aware of what fraud is. But some of the things that are key is someone must make a false representation. A false representation being obviously in an auto theft that their vehicle was stolen when in fact it wasn't. The second area of misrepresentation is material to the transaction. If you're selling a bracelet and lie about something completely unrelated, like, you have a house in the Hamptons, that has nothing to do with the fraudulent act. The misrepresentation is made with knowledge that a false‑‑ or with reckless disregard as to whether or not it is true. Whether or not you have to know you are lying or be saying something you are not technically sure of is a big difference. You know, if, for instance, you say that a bracelet was once owned by Brad Pitt, even if that's technically possible, but not true, there's an element of fraud in that.
Misrepresentation is made with the intention of inducing the other party to act or refrain from acting. Basically, if you're trying to affect the transactions with your lie – if you're adding spice to the transaction – that can also be considered fraudulent. The other party has to rely on the lie. The buyer cannot sue you for lying about the bracelet if he doesn't buy it. So, for instance, if there is no act in furtherance to the fraud you have a situation there. The lie also must proximately cause the other person to suffer damages. If the seller lies and says the bracelet is made of plastic when it's actually made of gold, there's no harm, no foul. These are just an overview of the fraudulent aspects and obviously going back to your house counsel or going back to your group’s attorney firm if there's any question is obviously recommended.
How big is a fraud problem? Insurance fraud occurs every day and in every state. This is not broad to races or incomes or ages. People every day commit different fraud acts in the insurance area. Within a business, this affects everyone. Supposedly the cost of fraud today is $80 billion a year. My understanding is if fraud were a business, it would be one of the Fortune 100 companies in the country. If you take that kind of money and introduce it back into the economy, you could see the difference it would make. The Coalition Against Insurance Fraud estimates that each family pays about 950 extra dollars to cover the cost of fraud. I don't know about you, but $950 is becoming a bigger number each month that we're going into these different problems that we're facing economically.
Ed: Tony, we've had a chat question come in. Do you have any ideas how successful insurers are in pursuing fraud cases?
Tony: Actually, I don't. I know from personal experience that depending on who you're dealing with, some insurance companies are actually targeted by fraud perpetrators. I don't have any numbers that would reflect that.
Ed: Thank you.
Tony: I mentioned a little bit earlier the difference between hard fraud and soft fraud. I think whenever you are talking about fraud, value judgments come into place. It's always a hard thing to talk about in different areas. I can't put my values on you, but hard fraud is a deliberate attempt to either stage or invent an accident, injury, theft, fire or other type of loss. For instance, we'll talk in a few minutes about plant closings or layoffs. It's the guy who comes home or the woman who comes home and says, “I can't live on unemployment. I'm going to go into work and slip or fall or hurt myself.” That is a deliberate act; that is someone who is setting their sights on committing fraud.
Soft fraud is the opportunity for fraud. It occurs when a policyholder or claimant exaggerates a legitimate claim. A guy comes out and the side of his car is absolutely taken out. It's been hit by another vehicle and all of a sudden the front-end damage is also part of the accident. That would be an example of soft fraud. It wouldn't be someone waking up that morning saying how am I going to hurt the insurance company? Or how am I going to commit fraud? It would be an opportunity situation – the opportunity being the accident and having the previous damage on there, or someone going out in a workers’ comp claim playing baseball on Sunday and then Monday morning having an injury. We're going to talk about different ways that we can observe that. We can fight it and also identify information that will hopefully help you reduce some claims costs there.
The basic thing we're trying to do today is take the opportunity out of fraud and theft from your companies, from your insurance vantage point. Some of the things that I want to talk about is when you really ask that question – how can we do something to change the amount of fraud that's being committed? The first thing I think people need to look at in companies hiring people is, what are you doing in the hiring process. The beginning is when you are taking these employees on. I own a business of my own, so I know every hire we make. It could potentially help the company greatly; it could potentially hurt the company. So being in the business I'm in, I do a lot of due diligence on each of our employees. I know when you have a tremendous amount of employees it can be very cost effective and it can be very deceiving. You can go online and run a background on anybody. Are they covering the things that are necessary? And some of the things I want to talk about we'll go through that I think add value to you.
Employee surveys reflect the harsh realities of your applicant pool. According to this record, 56 percent of the work people admit they have lied to their supervisors. Again, going back to the morals of it: What is a lie? What is not a lie? We're not going to get into that, but a lie as I understand it is a misrepresentation, however big or however small that may be. 41% say they have falsified records. Obviously, being in the businesses we are in, that can be potentially very harmful to us and our customers. Accuracy is everything to us. 35 percent have stolen from their employers by their own admission. If you used an example of hard fraud against soft fraud – have they taken a computer? Or have they taken a paper clip? Again, it doesn't go into the details of that, but I'm assuming stolen means they took something that wasn't their own. And, lastly, the thing that scares me the most: 31 percent abuse drugs or alcohol, and that's while on the job. That's not they go home on Friday night and party for the weekend. It's people who are actually working with substances within them.
Employment screening is probably one of the best ways to start, in my opinion, to fight fraud. When you're hiring an employee, you need to either have your staff or have people that you can trust dig into this employee. Obviously, following all fair credit reporting acts and privacy acts – you need to make sure those are covered. But the employment history – there are various ways that you can find employment history which we'll obviously go over. And you need to know where this person has worked no matter if it is one day, or one year or ten years.
Theft and related activities: Is this employee prone to theft or criminal behavior? You need to find out that information.
Have they been in any work related or alcohol use situations? A previous employer by law isn't going to go into that. Most employment information is they worked here from this date to this date. That's about it. If you have someone telling you that they wouldn't rehire them or other information, that actually can come back to bite the previous employer.
Violations of company policy: We'll talk on how potentially we can find that.
Recent use of illegal drugs and criminal behavior are topics that we'll cover.
Employment history – getting into more detail on that. The employee resume can be provided by the applicant. Obviously, if it is provided by the applicant, you need to fall into the‑‑ it's a shame, but being in law enforcement for as many years as I have, you become very cynical. I can tell you that I went to Harvard, which I would not have a chance in the world of getting into Harvard, but unless you confirm that, that information appears to be true. You can find resumes on the Internet. A lot of times people will post resumes. By searching the Internet and finding a resume, you have something to compare it to. If on the resume you were handed it says "A" and the resume you found on the Internet says "B", that would probably be your first red flag.
By searching for employment history on databases, you can find work data for instance if you go on to LinkedIn. I'll give you all of these web addresses if you're interested. But you go into LinkedIn and it says, Tony Van Gorp's the owner of Investigative Solution and other pertinent information. The problem is, once again, I can tell you anything I want. Depending on the business, obviously, the people are going to try to be as true as possible. If it's a doctor or a lawyer or an investigator or an insurance person, they're probably not going to want to publish information that would come back and discredit them, but, again, you would have to find that out. Also, it provides address data. For instance, with me, if you follow my career, you'd see that I worked in Chicago at CNA. You can see that I worked for the Dupage County State's Attorney's Office. This is giving you all geographic areas to do further searches. One area that has become very, very helpful in finding information in many situations is information people have posted, or they don't want to be found, on the Internet. We provide training on how to find information on the Internet that is amazingly helpful. Everything's easy to find on the Internet if you know how to do it. By finding resumes, news articles – a news article may indicate they were arrested for drunk driving – it may indicate that they got a very prestigious award. It could be good or bad. But by searching the Internet, you can continue to do the employee history that you need.
Some of the areas that basically take a lot of foot work are illegal activities. By going out and asking for this information through the Freedom of Information Act that's available, you can run databases to find histories. The problem is, I know through my experience at the state's attorney's office, someone can be arrested for murder, and I'm obviously saying this tongue and cheek, and end up with an arrest or a conviction for jaywalking. Just because someone's arrested for one area doesn't mean they are ultimately going to be convicted. The employer needs to be able to see the process of the actual trial, the conviction, and what the charges were. So my suggestion would be obviously if you're doing that type of background, you're going to go to the location and get that information because you need to find out what the actual charges were. Was there violence involved? Were there sexual offenses? Anything like that. That obviously can come back and hurt your company greatly. Recent use of drugs, obviously, again through court history and criminal behavior being violent, being predatory, you need to know those things before you hire someone, and we all see situations where someone hired a man or a woman to go in and do insect removal or whatever and the next thing there's a rape involved or there's a situation like that – again, that comes back to the company so you need to make sure your due diligence is done. Obviously, the best defense is a good offense. So if you can lay all these documents out and say in good faith we believe this gentlemen was who he said he was, I think the results would be far greater. Some of the areas that you can go into - and, I understand we have some safety people on the line – this is what I'm assuming a lot of the safety people are involved in helping their companies is to educate the work force. I think the best way to go about that is first defining what the fraud and theft policies of the company are. What are fraud situations? What are theft situations? Explain the company's policy on fraud and theft. If you don't have policy on fraud and theft, obviously the best place to start would be there. You need to explain the fraud laws depending on the state you're in. We will talk more about insurance fraud and the different various organizations through the state and private that can help you battle fraud there. But, in this situation, it would be your own company policies.
Ed: Tony, what I'd like to do is poll the audience with another question. And, basically, this question is, when was your work force educated on the company's policy on fraud and employment consequences?
We'll close the poll and broadcast the results. Here, one can see the results. We have a lot of people out there who have been never educated on the company's fraud and employment consequences. A lot of training has to be done. How about that?
Tony: Yes. And for the people who have voted, unfortunately, the time that you realize there's a problem is when the sump pump isn't working and it's raining out. It's always after the effect. I've been involved with companies that had a tremendous amount of money stolen through internal theft. They were like, "we never thought of that." There's nothing to feel negative about. It's something we're hoping this type of conversation will bring out through this education. It's a good thing, I feel.
One of the things people need to know, too, are the consequences of fraud. What is it costing the company? If the company has X amount of dollars of fraud, is that going to affect the 401k? Is it going to affect the ability to pay for the health benefits of the employee? Employee consequences: Are there layoffs in the future because of a $300,000 embezzlement? Are the employees going to have the future they would have if that criminal act wouldn't have happened? I think those are things that people don't think of, just like we don't think of the training aspect of it. We need to let people know that because of the economy or because it's just been brought to our attention that resources aren't as available as much, that we need to start looking at stuff like this.
And then finally, criminal process. If people are having a tough financial time, obviously by paying for an attorney, by losing a job, by spending a year in prison or two years, or whatever, or even just having probation, that is going to affect their financial situation and the company's as well. I think those are some of the ways that we can educate the work force.
And, lastly, are safety incentive programs sponsored by the company. Obviously, if any of the safety guys out there want to shoot in any information about that – what you found effective or what you found helpful – but I mean, there are companies that actually incentivize the employees for not having an injury on the job or for not having a negative safety situation. That's all part of education and that's all part of buy-in that I think all the companies need to start thinking about, or for the companies who are starting there, who have thought about it, possibly sharing that through the networks we're involved in.
Cross‑functional team approach to this economy. I think one of the things I've learned over the years, when I started my career as a local law enforcement officer, I never really got into it's them against us. It's whatever. I always felt by bringing in the state's attorneys, bringing in the counselors department of children and family services, that the holistic approach to problems is probably better than this lone ranger – and I know I'm probably dating myself with a lot of people, but I cannot think – like a batman, maybe. We need to bring in the resources we have and you can see from the different areas that I've portrayed here, we have the insurance investigations. We have the claims professionals. We have the nurse case manager, human resource, medal professionals, safety professionals. In loyal employees, I think the thing we need to do is always remember you can't throw the baby out with the bath water. Every company has good employees. Every company is able to provide employees that do want to add to the company's viability.
Fraud and theft deterrence. We talked about education, we talked about consequences. Deterrence – we need to let them know that they can be part of this problem. We can motivate reporting, and reporting can be through private ways – it can be through 800 numbers. However, people want to let the company know that information can be handled, and then obviously through guest speakers. The local police officers can help as can claims adjusters. I know when I worked for CNA insurance company we had some clients that once a month or once a quarter would actually go out and walk the floors. One, it built rapport with some of the people that were out there, and, two, it also gave them the understanding that there were people who knew what they whether doing who were able to investigate fraud.
Fraud posters. I'm confident – I don't know this for sure – but through National Insurance Crime Bureau, they have various posters that are available.
Safety meeting topics. There are many topics that you can cover in safety meetings that would also help you with the deterrence. I mentioned phone numbers, by setting up a tip line, suggestion box, trusted persons – by them being able to go to people in the community and building that community synergy between your company and them are all ways you can help to deter the fraud situation.
One of the things that I was taught – I went from the state's attorney's office to CNA insurance – and, quite honestly, I knew how to investigate white collar crime. I knew how to investigate narcotics, but I wasn't real versed in insurance. And one of the first things they taught us were the red flags. What is it that you would see in a file or what is it that you would see to make you suspicious of something? Obviously, if you see one red flag, that doesn't mean the person has necessarily done that, but if you see three or four red flags, you can be drawn to that topic.
Some of the things I think you need to look at – and obviously we can all read this at some other time – are disgruntled employees. A lot of times when you're going through layoffs or someone's denied a vacation or demoted or fired, you'll see that disgruntled person in your employment. Obviously that doesn't mean they've done anything wrong. It could be an opportunity for the H.R. person to work with them and let them know they are valuable, and include them in the company. But that's also an opportunity for people to become disgruntled and start acting out. If you have a fraud situation on workers' comp, a lot of times in my own experience – this is not a scientific statement – but a lot of times the disgruntled attitudes can work into a situation where these people are actually committing fraud – not always but sometimes that can happen. If you have an employee who is off work because of an injury, they are hard to contact, that should probably be a indicator. If this person has a limit of lifting 2 pounds and is not supposed to walk for more than five minutes, you know that employee should be available via the phone. That may be another red flag for you to follow through on that.
The new employees – statistically, the newer the employee is the more likely the claim is fraudulent, especially if other red flags appear. Again, that doesn't mean you get a new employee, they get hurt and they're committing fraud. What that does is, it gives you an opportunity to look at that and take the information. Now, if you find additional red flags, then obviously that might be something you'd want to look at a little closer.
If you have a workers’ comp claim and there are no witnesses, obviously using common sense, if it is a midnight clerk who's stocking the shelves and you talk to the management or you talk to the people who are involved and they say, no, it's very possible there were no witnesses because they work on separate aisles or whatever, that would be a situation that you would go, "okay, maybe it is not." But if you have employees that are hurt and there are no witnesses, we will talk about what you can go to next. How can you find out if there's video camera surveillance in the building? How can you find out if there were other people within earshot? You can go back and work backwards on the investigation.
Verifying accounts of accidents. Obviously, one of the things I think a good investigator adds to the mix is that people are co-workers, people play on softball leagues and have relationships with people who have accidents and who are not telling the truth. You need to find a way that that person can be covered for sharing that information to you. One of the things that we'll do, we'll say, "look, you've told us you don't want to get involved in this. What's another way of us finding this information? Where could we go and get this information?" And obviously assuring the person they're not going to be brought into it if there's any possible way not to. That again goes back to the investigative techniques. That is stuff people can learn very easy.
The last red flag would be accidents on Fridays and Mondays. Usually we run into situations where an accident happens at the end of the week. Obviously, depending on the shifts, the Friday might be a Tuesday and the Monday might be a Saturday. Who knows? When you go into a situation and it's either the beginning of the week or the end of the week, that's something to always look for. Did the employee have a long weekend and just need an additional day off? Or is this there something more sinister involved in that? Either way, that is affecting the company's productivity. There needs to be a replacement employee brought in, and obviously the workers’ comp laws will hurt the company as well. Those are all red flags to look for while you're investigating these claims.
In workers' compensation, a lot of times you'll see situations where it's just before an announced layoff. We talked about that where people are considering the financial aspects of it. A work strike just before the onset of cold weather – if they are laborers or if they're cement layers, anything that might affect their ability to continue to work in that, one of the things I found that I thought was relatively interesting, I don't know the level of knowledge you guys have, but a lot of people are into YouTube. www.Youtube.com. I typed in liability. I typed in work comp, and you can actually watch some of the videos that have been found through neighbors. It's an interesting resource to learn more about what's going on out there. And, unfortunately, I didn't have the technology to have that come up here, but, again, if you go to YouTube, those are some of the things that are available.
Talking about liability claims, there are a lot of situations where a company is hit with a claim for liability. One of the things I think is hugely important is, pay particular attention to witnesses who give statements that don't have detailed identities. A lot of times we'll go out on a claim and everything looks very legitimate. There was a witness who saw this and they fell and all of a sudden we start running databases and looking into this witness and what we have found is, in some cases – we found that it is either someone who knows this person or it's actually someone who was staged to be there. We can find that information through cross tracing their former addresses. We can do that by interviews. But when you get a witness who doesn't have a lot of standard information involved, that should raise red flags for you to start looking at it a little bit differently and to possibly call in assistance on that. If a claimant cannot be easily and readily identified, it should be considered a red flag. Again, this is a situation where the average person, if you do a background on me, I'm pretty transparent. I can be found pretty easily. Again, there are situations that the person might have that are legitimate. They're in the military. They've been moving, traveling, whatever. Again, those are all things that can come out in a conversation.
Multiple aliases when databases are run. In today's society of divorces, there are situations where a person might have two or three different last names, and, again, that can either be a lead or it can just simply be a circumstance of life. Multiple addresses and associations, again, depending on who you're talking to, that could be very normal. One of the things that is becoming very popular in the insurance industry is data analogy. How are these people related? Data mining. By using neuro nets or search engines, you can actually see where people's addresses come together. That's available through investigators – either S.I.U. or private investigators – and it's something that has become very helpful in the fight against fraud.
Again, going on with investigating liability claims, involving slip-and-falls, chemical burns, and product failures. Document the scene and injuries in detail. I have had situations where all of the best intentions are good, but all of the elements that are needed are not covered. You know, if this is something that you would need help with your company and, Ed, you can correct me on this if I'm wrong, but I believe Gallagher has the ability to come out and help you with that type of scenario to help you set up these different things. But that's hugely important when you are investigating a claim to make sure that you are documenting what has actually happened, and where it's happened. Potentially take pictures, collect specimens. If it's a burn, what kind of chemical was it and so on.
The key to these investigations are documentation and responsiveness. If you have a situation like that, and you're not responding to it for days, that can actually affect the tape. If there is surveillance tape, that tape might have been destroyed if you don't get out there quick enough. If there's substance the person fell on and is not collected, that might be important to the case, it may be germane to the findings. You need to get as much information as you can in as little response time as possible, and that, obviously, is going to affect your claim. In the video that's attached here, if you go to YouTube you could actually find this. You can see the lady pouring out oil, looking around, and then pretty much laying down. She doesn't even fall. That was a situation of slip-and-fall. So, you know, it's definitely something that's available out there and people are doing. It's just us being on top of it.
General tips: These are some of the things I've learned through the data investigation aspect of this through the insurance company and private work. Motor vehicle records are very revealing. If you run a motor vehicle record, it might come up that the person was arrested for DUI or other crimes that actually are going to add to your investigation. If a person has a DUI, that happens, but is it possible that that person has a problem and they were intoxicated when the workers’ comp claim occurred? It's all stuff you can look into. The big thing that we find are digital security video cameras. When you go into any scene and, obviously, you know your own companies, but in a liability situation the first thing that should be checked are the videos, and that should be brought into evidence. That video needs to be maintained in a chain of custody. And I would imagine the manager or safety person or SIU person would need to take that into custody immediately. In many situations it substantiates, because some of these claims are very valid or refutes the claim.
Internet investigations may reveal information about the person. There's a lot of different Facebook, MySpace, you know, people are putting pictures of themselves up there. If you are sending out people, private investigators to do surveillance, you need to know who that person is.
Memberships or information that may lead to different activities they're involved in. I know in one case we went on to the person's Facebook and they actually said they were going to work for this camp during the summer. That was a helpful lead, and obviously readily available on the Internet.
If you find yourself in a situation with layoffs and facility closing, here are a couple of things that might be helpful to you. These situations, obviously, can create an adverse atmosphere or an adversarial atmosphere that may trigger workers’ comp claims. It's a hard fact that when companies do have layoffs or plant closings, the workers’ comp claims go up rapidly. Approximately 40 to 50% of laid off workers will file workers’ compensation claims within six months of termination. Some will possibly be fraudulent. If you follow plant closing instructions or plant closing plans, that's one of the things you can cut down by documenting their work area, documenting if they have been injured. If you can't completely deny the claim, you can at least mitigate it by having the information ahead of time.
Ed: Tony, in our presentation coming up next month, we're going to have an industrial hygienist talk about occupational health and industrial hygiene exposures. Just because a company shut down a line or an operation, they need to document from an occupational health or from an industrial health standpoint what existed, and even more importantly what didn't exist.
Tony: Exactly.
Ed: I turn it back over to you.
Tony: This will sound like a canned pitch, but you guys are really covering everything that needs to be covered. These are all things if you bring all the synergy of the different groups involved with this, it's a great thing. So, again, like Ed said, if you're documenting there was no grease on the floor, that's going to be as valuable as they slipped on the grease on the floor. It's just documenting whatever is there. That's a wonderful thing.
Layoffs and facility closing preparations. There's obviously a lot more to this, but just a couple real quick points. Run an anti-fraud campaign before the layoff and closures. Let people understand that this is nothing personal. This is a financial situation. I think that could affect some of the people's thinking. If it's just, "hey, you're getting laid off. We're going to Florida for a vacation." It's going to be a lot different if you make it more human and deal with the people on an individual and group basis. Inform the employees what constitutes fraud again. Let people know what a negative aspect of it is, and let people know that that is something that's going to find them in trouble. Again, bringing in local law enforcement, depending on the police officer, that could be a good or bad thing. You don't want anyone coming in there who has a negative impact on the people. And relationships are built through businesses, and I think by choosing the right person to come in and talk to them, that might be a good thing.
Include fraud paycheck stuffers with pay checks. As the time is coming up, you could put in information into their pay checks about reporting fraud or about how it could affect the company. Post reporting fraud posters. We have resources for that. Inform insurance carriers and ask for assistance. If there is a situation where there is a closing, you can bring in the safety people and bring in the nurse case managers, whoever would add value to that to document what the employees are or are not doing. Settle old claims before the announcement. Let people realize you are not out to hurt them. By going in and showing good faith ahead of time, it might have the people a little bit more confident in what's happening.
Investigative deterrent. Preparation. Again, any type of anti fraud campaign, people can really relate to that. I don't know what it is. But I think when you are talking to these people and letting them know what's coming up, it's definitely going to help in that situation. One of the things that I think is important is in-house workplace accident investigations. Again, we briefly touched on that. But one of the things that really adds value is your first report. I've seen them where basically it has the name of the company, no other information, the name of the claimant, and fell and hurt his leg. I've seen that all the way to a complete investigation. The more thorough the information the claims carrier receives, the more quickly, I think, they can respond to it and get that information to the proper authorities or the people who need to investigate it.
First thing I think you should do is immediately interview every person who was at the work site, again, using different techniques to get information. Some people aren't going to want to talk in front of everyone else. Be cognizant of that. Don't have the claimant and three people standing there saying, "who saw it?" You need to use discretion in that. You need to document who's there and maybe at a later time talk to them when the claimant is brought to the hospital or whatever.
Who was in the area at the time of the alleged injury? A lot of times you'll have people who were a couple aisles over but could see what happened or hear what happened. That will be important. Don't limit the investigation to witnesses. Make sure you are talking to people in the crowd. You will have some people who will not come up and offer anything. Conduct tandem interviews or recorded statements. You need to document what happened by interviewing these people and getting the statements. Obtain additional documentation that's available. Again, if there were video cameras, if you have the ability to take photos, which I would recommend, anything that would add to that is going to help. Diagrams in situations . . . people are going to come and investigate something that is a year later. You need to know where that was. Maybe they moved the shelving. Maybe they've taken areas from that that you wouldn't readily recognize, and that's important.
Human Resources’ reviews of claimant's personnel file for background information; any prior injuries. A lot of time we'll have very vague information. It's important for us to know where they've worked in the past, information they've given. And, obviously, that's working in conjunction with Human Resources so there's no negative aspect of that in all the privacy laws that are followed.
The biggest thing that really helps in these investigations is establishing a point of contact. When we get claims or when I got claims working for an insurance company, a lot of times there was no ownership. It was hard to find out who we could go to and get what we needed. If your company is in a situation that you have a claim, that's a huge and very valuable thing. You know, relationships build those successes that are out there. We need to know who to work with. We need to get the information that's available. I think one of the things that does that is site visits. Let the safety people be known. Let the insurance company representatives come out, get to know you and work with you. Because, again, that relationship can also form preventative measures that are going to add value to your savings.
The next area we're going to cover are data investigations resources. One of the things that I find just amazing is the availability of information on databases through court searches and, again, through the Internet. The problem is verifying the information you do find. Some of the areas that you can find information are local, state and federal databases that are available by going to the courthouses. Is there information available that might mitigate the claim? That's the thing you need to work with.
The claims handlers. Establish what would add value to this file. If the person was intoxicated or there was horseplay or whatever the circumstances, the adjuster will be able to tell you what would add value to the claim, if, in fact, that was happening. In one of the instances that we had, the claimant was actually injured in prison prior to his claim and it was tied to that injury, not the claim of the workplace. We had done a database search on the gentleman, and we realized that he had just been released from prison. We followed it up, and he was actually injured in prison with a preexisting claim. There are a lot of resources out there that are available to you.
Background investigation: Does the claimant have a UCC filing? UCC filing is Uniform Commercial Code. Basically, that is, is he borrowing money for a business? The gentlemen had severe burns on his arm and it happened at his business, but you find out that actually he owns a pizza place. It's just investigative leads for you to be able to follow. Are there bankruptcies that might provide financial leads or information? Again, this goes to the red flags. Is there a financial problem that might cause someone to file a workers’ comp claim? These are all things to look for in the data. Does the address history provide additional leads? Were there other claims with this subject that you could find?
We talked a little bit about the Internet investigations, and, again, just the information age is amazing. You can see the numbers there of the people that are involved in the Internet, and it's just a great resource. A couple of the things that companies use for investigations is surveillance. Our company does do surveillance. One of the things I think you really need to look for if you're hiring surveillance is whether the company's reputation is huge. You need to know about them. You need to know if they are trying to sell surveillance or are they trying to sell results. Is the company asking for five days of surveillance? And what is their policy on identifying if someone's home?
Discontinuing surveillances. You don't want to get a five-day bill for someone who has not been home for five days. It is something you need to establish. I'm confident that Gallagher is probably very involved in doing that when they hire their various investigators, but it's something for you to look at. Again, I mentioned an analogy, just because it's a workers’ comp claim does not mean surveillance is the answer. People will tell you that is true, but there are a lot of resources. Make sure you're using people that have a lot of arrows in their quiver. What are the options? And, lastly, what is the equipment you have? Are the people able to go into a store with a bad camera and do undercover where they can see the person walking around? Again, are they aware of the laws that are involved in that?
Site surveillance is becoming more and more valuable. We hear it in the news all the time. What capabilities do people have to monitor information? And what availability is out there? It's one of the first things that should be asked when you're going through a slip-and-fall or a workers’ comp claim.
Another valuable tool that is out there are hospital pharmacy canvasses. Are the people seeing various hospitals or pharmacies? If you're identifying someone who's seeing multiple pharmacies or you’re identifying someone going to a pharmacy that's far from their home, those records, obviously, might be valuable to your investigation, and you are also hopefully, potentially, identifying doctors that the person has used.
Some of the helpful resources: I like to share a little bit of information every time I do a presentation. Some of you may know about this; some of you might not. One of the searches that we use quite a bit is a PIPL search. pipl.com. Basically, you put “Tony Van Gorp” in there and it goes to all the databases they are associated with, and it will bring up information – personal and professional. It's very helpful. Bowl.com. If you put in “Ed Zabinski”, it will tell you if he's involved with bowling. In a lot of cases we found people who have an unbelievable bowling record, but they've been on workers’ comp the last four years. So it's something that helps quite a bit. Dirt search is one and then multi database. What that means is like a people search. It goes into additional databases. You don't have to go to each one. These can help with your investigation.
One of the last topics I want to cover real quickly is the state fraud bureaus. One of the things that are very important and very helpful is many of the states – Illinois being one of them – have established fraud bureaus to help fight the different fraud situations we're involved in. In fact, they are getting investigators who have a background in this, who are able to assist in the prosecution and able to teach what they need for the prosecution, and are just general excellent resources. Our director of investigations left us and went to the Illinois State Fraud Bureau and is an excellent investigator. They're doing a great job. They're prosecuting a lot of claims, and their resources are also available to you just by typing in “fraud bureau” and then whatever state you're in. Those are a couple of things I hope add value to this whole topic.