Gangs organise fraudulent claims

Organised criminal gangs and subversives are involved in targeting insurance companies through bogus insurance claims, the Garda Commissioner, Mr Noel Conroy, said yesterday.

At the publication of new guidelines for the reporting of suspected fraudulent insurance claims to the Garda, the commissioner said some gangs were involved in the intimidation of witnesses who were to give evidence supporting false claims.

This was especially the case in the Border area, he said. "People are being intimidated into getting involved" in supporting bogus claims, he said.

The guidelines published yesterday cover how insurance companies can handle suspected fraudulent claims so as to be of maximum assistance to gardaí conducting any subsequent investigation. They include new initiatives on communication between different insurance companies, and between companies and the Garda, as well as advice for insurance companies on the handling of potential evidence.

Mr Conroy said the Criminal Assets Bureau had targeted one individual who had obtained judgments for over €1 million.

He said as well as larger, bogus claims, the Garda also had experience of smaller cases where claims for events that did occur were exaggerated, or where people sought to insure themselves after an event.

He said such actions were "not wise" as the people concerned were committing a serious offence and would be caught.

The commissioner said he was "delighted" that former gardaí were now working with insurance companies helping them combat fraud and investigate suspected bogus claims. "They know what we need in order to bring these people before the courts."

The president of the Irish Insurance Federation, Mr Paul Donaldson, said the guidelines were just one piece of a larger "jigsaw of action" being taken by the industry. "Insurance fraud costs the insurance industry an estimated €100 million annually in Ireland," he said. This was the equivalent of approximately 2 per cent of annual premiums.

He said his own company, Royal and SunAlliance, had reported 16 cases of suspected fraud to the Garda which had resulted in successful outcomes in the past year. A further seven cases were currently being processed. He said the biggest of the fraudulent claims involved more than €1 million.

Both Mr Conroy and Mr Donaldson said that contrary to the belief some people held, insurance fraud was a serious criminal offence. It was not a victimless crime as it led to increased premiums for the public.

The "insurance confidential" telephone line operated by the federation has resulted in 2,000 cases of alleged insurance fraud being reported in the 18 months since its inception. More than 50 per cent of the calls received had been followed up.