Archives for November 2012

Busted: How Getting Rid of Insurance Fraud Helps Everyone

by: Tom Reitze

Insurance fraud is rising, and currently costing insurance companies (and consumers) over $100 billion per year. That translates to 25 cents of every dollar that we pay in insurance premiums, going to pay for fraudulent claims. How much do you think that adds up to, for your car insurance, your life insurance, and your home owners insurance? It’s a lot. Or, looked at another way, without any insurance fraud, all of your insurance premiums would be 25% less.

Since all businesses these days have to have insurance, and paying for that insurance is part of the cost of doing business, that means that insurance fraud makes ALL the products and services that we buy more expensive. So a small criminal element is costing us all more money.

But some investigative companies are doing something about it. Independent investigators David Morse & Associates ( provide surveillance investigation on suspected insurance fraud, and if fraud is found, helps bust the perpetrator.

Here’s a recent story from one of our investigators, in tailing a man claiming total disability, but suspected of not really being disabled:

“A first rule of surveillance in rural areas is: When in Rome do as the Romans do. Or perhaps better stated: Look like what a Roman would expect a stranger to look like. For the last several years in many situations that has meant: look like you are interested in buying real estate.

“Our assignment involved a claimant alleging total disability, and he was located near a small (population 400) farming community in the middle of Missouri. I arrived just prior to Labor Day weekend and quickly realized this was not going to be a walk in the park. First, the Mapquest to the claimant’s only known address led to the fifth row of a cornfield.

“Second, Labor Day was approaching rapidly and every store and public facility in town was closing. We knocked on the door of the tiny City Hall, the only known repository of records, but got no answer. It looked like it was shut down tight already. Main Street was deserted. But the experienced investigator knows where he can get information even when faced with such daunting absences – the nearest bar.

“Finding the bar was easy, but soon I was striking out once again. Asked about land I “heard” our claimant had for sale, the bartender knew nothing. The few patrons in the place knew nothing. I stepped back into the dusty street with an uneasy feeling and not one good idea of where to go next.

“But I was rewarded for not staying in the bar to enjoy several cold ones and feel sorry for myself. A woman approached and asked if I had knocked on her door. Turns out she was City Hall staff, by herself in the office and on the phone, thus un-able to answer the door. One thing led to another and pretty soon I was studying a map showing the location of every house in town.

“I soon arrived at the residence I found on the map, and confirmed it was the home of our claimant. But the test of investigator will was not over. There was no activity. I waited and still nothing, totally quiet.

“Some digging was in order and once again I resorted to an establishment purveying liquid refreshment. This time, closer to the residence, I came up with what I needed. The claimant was possibly building a house in a nearby town, and was known to be in Southern Missouri attending a wedding. Best of all he was expected to be home later that night.

“The next day I followed the claimant from his house out to a farm ten miles outside of town. That was easy, but it turned out this assignment, as a test of investigator will, was the proverbial Bar Exam or SAT. There was no place to park outside of obvious view. Farmhouse, fields and the road – that was all there was. No trees, no stone outcrops, not another parked car within five miles. No hills with vantage points from which to view the farm.

“Your tireless investigator proceeded to the last resort – staging a vehicle breakdown off the side of the highway just beyond the claimant’s farm (and disconnecting the battery in case the claimant proved to be a helpful type, which he did not). The claimant ignored the vehicle with its hood up and just continued with his farm work. I was thankful for this attitude as I sat in the back with video rolling.

“As any professor of agriculture (or five year old child) will tell you, farm work is not an appropriate use of time for the totally disabled. Just looking at the video of our claimant cruising by on a tractor, bouncing around over rough ground, and manhandling bales of hay makes me want to lie down and take a nap.

Our video was the end of that claim. The claimant was busted! And in my estimation, a pass with flying colors on this particular test of investigator will.” – Andy Schwarz, Investigations Manager, Los Angeles

Another victory for honesty, truth, and lower insurance premiums.

About The Author
Tom Reitze is President of David Morse & Associates (, an independent investigations and claims adjusting company with 42 offices in 16 states.

How To Prevent Fraud While Shopping Online?

by: Mark Alter

Internet has greatly changed the shopping habits of the people precisely because of the convenience it provides in terms of saving time and money. You do not have to travel from one shop to the other; you can simply sit in the comfort of your home and browse through the various websites, do a comparison shopping and buy the goods online using your credit card. That said, there is a catch and that is online frauds. Today, making money online is very easy and there are lots of opportunities available on internet. Online retailers have to provide safety measures to build consumer confidence. If you have an e-commerce business you must ensure that it is 100 percent secure and the sensitive information they provide is completely protected. Keep in mind the following points to prevent your E-commerce website against fraud.

Fraud Detection Service

There is a fraud detection service you can avail of to prevent fraudulent activities.
The fraud detection service asks the consumer to verify an address and compares it to what is one file with the credit card issuer. It the address matches, the customer is given permission to go ahead with making a purchase.

Credit Card Verification Codes

The credit card verification code is the three important numbers found on the back of a credit card. As a consumer, you would be asked to insert those numbers when you shop on a site. In order for someone to place website fraud, they most acquire the credit card numbers and the credit card as well. So if you have the verification system is place, you can decrease the risks of fraud significantly.

Site Design

You website design can also help to reduce online frauds. For this, your website should be designed with the latest versions of scripting languages and programs to fight off hackers and protect the integrity of your business. You may have to shell out extra money to make sure fraud is not occurring, but it is well worth it in the long run. Having a secure site will save you money and protect your customers, which is perhaps the most important aspect of online business.

Go for a trusted web design company to ensure that your website is protected against frauds. ITRIX Technologies, is one such company providing neat, clear-cut secure web design services customized to their customers’ unique requirements. Their certified web designers have extensive experience in web site design and graphic art. The company understands that your website represents your brand and can help design a solution that not only strengthens and creates brand awareness but also fulfils your business objectives. ITRIX Technologies can take care of your web needs from web hosting to web page design to online marketing.
About The Author

Mark Alter, the author of this article, writes about the benefits of a trusted web design to ensure that your website is protected against frauds. Want to know more about ITRIX Technologies and web design? Still lots of things remain to explore.

Top Ten Elder Fraud Prevention Methods

by: Jill Gilbert

We all want to protect our loved ones from danger, but it’s impossible to be with them every moment of the day. And unfortunate as it is, scam artists see your aging Mom or Dad as an easy target, knowing full well that elderly individuals are more likely to fall for their scams. Elder fraud often goes unreported, but it’s estimated that over $40 billion is stolen from America’s seniors every year (1), and, due to a lack of proper senior citizen fraud protection in place, this figure is increasing. Families and friends are fighting back and providing their loved ones with senior citizen fraud protection tips and tools to combat these elder fraud scam artists.

‘If it’s too good to be true, then it probably is’ rings true in many instances. Law enforcement agencies often remark on just how difficult it is to bring elder fraud perpetrators to justice – once an investigator has begun looking into the scheme, the scammers are already moving on to another ploy. There’s just no way to catch them all, which means it’s up to you to help your parents understand and implement senior citizen fraud protection tactics and be on the lookout for people who wish to do them, their property, or their savings significant harm.

How can you help your parents fight back against elder fraud? Aside from a quick lesson in senior citizen fraud protection, a handy cheat sheet by all the phones or computers in the home is often the best way to avoid these common elder fraud tricks, which include the following top ten ways to beat the bad guys.

What to Include on Your Senior Citizen Fraud Protection Cheat Sheet

1. Avoid sending money or providing personal financial information. Be cautious who you disclose your bank account, credit card, and social security numbers to. Suspicious, but realistic looking checks made out for a considerable amount of money should be an elder fraud red flag. Your parents should know that if they weren’t expecting a check, it could be a fake. Tell your loved ones if they have concerns related to this type of senior citizen fraud that protection comes from asking someone they trust for help. Checks such as these are usually accompanied with directions instructing the recipient to call a phone number. The message tells the caller to send taxes on the money he or she just received through a wire transfer service. The scam, of course, is that once the recipient sends the money, their check bounces.

2. Do not speak at length with people who are unfamiliar to you – tell your parents to decline answering questions of a private matter over the phone, Internet, or at the door. Above all, the key to senior citizen fraud protection is caution. If a telemarketer who is pushing a product begins asking for too much information, tell your loved one to request the name of his or her employer, the address, and a phone number. If a caller asks to speak to the man of the house and there isn’t one, tell your mother never to indicate that she lives alone.

3. Do not sign any documents without reviewing them carefully. Your loved one can often be signed up for something he or she may not be interested in and begin receiving phone calls that solicit other products. If anything appears suspect, tell your loved one to contact his or her lawyer or a trusted friend immediately. Many elder fraud con artists will pose as door-to-door salesmen and try to sell your loved one something on the spot, introducing multiple new products and a whirl of paperwork that needs to be signed now and paid for to ‘secure’ it. This potential elder fraud ploy is dangerous, because the friendly salesman is no longer some distant threat with no face; he appears to be knowledgeable and trustworthy. Tell your parents one of the most important senior citizen fraud protection tools available to them is not to allow anyone into the home they don’t know.

4. Make sure to verify all claims. One of the newest elder fraud alerts is related to home construction or improvement, and much like any other industry, scams abound. The best senior citizen fraud protection tip in this instance is to use a well-known contractor in the area. Tell your parents to request references and contact the Better Business Bureau or the National Fraud Information Center if they’re unsure. Create a contract and make sure the work is carried out to the letter; a fly-by-night scheme will probably try to talk down the contract, but if it’s in writing, your loved one ultimately has more recourse. And if the contractor wants the money upfront, tell your loved one to move on to the next choice.

5. Reach out for help before investing or spending considerable amounts of money. Tell your loved one to call you with questions about any investment that involves a significant transfer of money or shares. In many cases, the AARP (American Association of Retired Persons) can be a lifesaver; this organization regularly sends out information on the latest elder fraud schemes and offers senior citizen fraud protection tips as well as financial planning assistance and consumer rights, all of which can help your parents judiciously decide on various offers and purchases.

6. Shred all bills, notices, and personal mail before throwing them away. Information regarding your loved one’s financial situation is often retrieved by con artists from discarded mail that is not shredded (also known as ‘dumpster diving’). It’s all too easy for elder fraud scammers to get bank account and credit card numbers from statements as well as details on safe deposit boxes, ATM cards, addresses, phone numbers, social security numbers, and more. Remind your loved one that one of the most important senior citizen fraud protection tips is to tear up all mail before throwing it away. Or, better yet, give him or her the gift of a paper shredder!

7. Recognize predatory lending practices. This senior financial abuse and elder fraud practice, also known as loan fraud, is often perpetrated by mortgage brokers, appraisers, and home contractors looking for a quick buck. Seniors approach these seemingly knowledgeable individuals looking to refinance their homes, but are bombarded by fast-talking scammers who incorporate a must-act clause into the deal. In the end, your loved one will walk away with a high-cost loan with exorbitant fees totaling more than 5% of the entire amount. When talking with your loved one about predatory lending and senior citizen fraud protection tips, remind him or her that other tricks include pre-payment penalties, ‘flipping’ (when a loan is refinanced to generate fee income without providing any net tangible benefit to the borrower), mandatory arbitration, and other unnecessary additions. Don’t let your parents make this decision alone; help them be more informed consumers.

8. Avoid health insurance scams by identifying the red flags. Many lower income seniors rely on their Medicare health insurance, which is why many elder fraud scams originate here. Often, less-than-reputable medical equipment companies target seniors, offering free supplies in return for their Medicare numbers. Tell your loved one that the doctor must order and sign for all equipment and products before Medicare will pay for it. Remind your parents of the most important senior citizen fraud protection tips when it comes to health insurance, including never signing blank insurance claim forms, never providing unchecked medical authorization for billing purposes, always reviewing Medicare’s payment terms closely, never giving out their Medicare numbers to someone they don’t know, and verifying with their physician if they are unsure of a product or equipment that’s been ordered.

9. Bypass the ‘Sucker List’ altogether. Many seniors are eager to win something and often enter numerous sweepstakes, sign up for free magazines, or register for contests. Companies with elder fraud scam artists will keep records of these submissions, meaning your loved ones could end up on what is called the ‘Sucker List,’ making your parents that much more of an elder fraud target. This list usually contains not only people who the scammers believe to be a good target, but have already been successfully targeted before.

10. Just hang up. Scammers know that senior citizens are more polite, more trusting, and a lot less likely to hang up when the call becomes personal; unfortunately, elder fraud con artists take full advantage of this fact. Tell your loved one that if he or she doesn’t know the caller and questions regarding financial or personal matters come up, they can simply hang up on the caller with no questions asked. Hanging up is one of the simplest senior citizen fraud protection methods.

An Ounce of Prevention…

If your loved one has been a victim of elder fraud, please urge them to report it to the proper authorities. Falling for a scam is embarrassing to many seniors, making it one of the most under reported crimes. Their assistance in the matter can help bring con artists to justice and perhaps inspire other seniors to implement better methods of senior citizen fraud protection.

Another invaluable senior citizen fraud protection tool is helping your loved one sign up for the national ‘do not call’ registry to prevent harassing telemarketer calls. It’s a free service, and you can either call 888-382-1222 or register online at Another website that offers helpful senior citizen fraud protection tips of its own – – helps fight against con artists by posting regular updates and information. Walking your loved one through potential elder fraud scenarios is as helpful as checking in regularly to go over financial transactions, bills, and emails as well as posting (in plain sight) the senior citizen fraud protection tips outlined above.

Ultimately, the only way to prevent elder fraud is through education, and this requires you to be firm on the subject, providing an insightful look into the various methods of senior citizen fraud protection. Caution is always the key to protection, and your loved one should be provided with a list of helpful sources to contact for additional information, including the National Consumer League’s Fraud Center, AARP, the Better Business Bureau, and Consumer Action. Above all, make sure your loved one always knows who he or she is dealing with in the course of transactions or investments. And, as always, it’s important to remember that an ounce of prevention is worth a pound of ‘cure.’


About The Author

Jill Gilbert is the President and CEO of Gilbert Guide, a website and comprehensive housing guide dedicated to solving the challenges of aging for parents and families and developing a working senior care plan. Jill brings extensive business experience to Gilbert Guide, authoring “Leading by Example,” a monthly column in McKnight’s Long-Term Care News, the chief industry publication for long-term care providers. She is currently working on a new book, Gilbert Guide to Senior Housing (Penguin/Alpha Books, 2009), and has been interviewed for a CBS News special, was a key presenter at the Pennsylvania Assisted Living Association’s annual conference, and was recently interviewed on San Francisco TalkBack. Jill has been quoted in numerous publications, including The San Francisco Chronicle and The Dallas Morning News. For more information on quality senior care services, please visit

Fraud In The Workplace

by: Mark S. Gottlieb, CPA, PC

The popular media have devoted countless hours to storylines that portray fraud in the workplace as an important plot device. From the early TV series Perry Mason and Arrest and Trial to the ubiquitous “ripped from the headlines” stories of the Law and Order franchise, as well as new series on cable such as White Collar, we’ve never lost our fascination for stories that involve fraud and how the perpetrator is finally caught. What compels the senior level manager, the low level employee or the longtime middle manager to ultimately risk everything, convinced that their crimes will go undetected? The characters in popular fiction, as in the real world, are frequently motivated by financial need caused by avarice, gambling debts, business reversals, poor investments or trying to maintain a lifestyle well beyond their means. Now it seems that almost every day in the business media there are new reports on workplace fraud in all its forms. The frequency of such reports now seem to be outpacing the tv episodes that draw from the “true stories,” and underscoring that truth is stranger than fiction.

In a time of massive Ponzi schemes and burgeoning white-collar crime, one can understand why fraud is not uncommon in the business world. In fact, employee fraud costs businesses billions of dollars each year. Employee fraud is an ongoing, widespread and varied problem, one that comes in all sizes for all kinds of companies. It can significantly impact a company’s productivity and profitability. The reasons for fraud are not always obvious to the business owner or even their attorneys. However, what is obvious is that it is often overlooked, ignored, and even undetected.

The current statistics for fraud in the workplace are staggering (source: ACFE Report to the Nations):

• The typical organization loses 5% of revenue due to occupational fraud;

• The median loss per case was $160,000, and it took an average of 18 months for it to be uncovered;

• Fraud is much more likely to be detected by tips, than by any other means;

• Smaller companies are disproportionately victimized by fraud, as they usually lack a sufficient level of checks and balances;

• Fraud is more likely to be committed by a single individual, without a prior history of fraud, who often raises a red flag because they are living beyond their means and are experiencing financial difficulties.

To better understand why these statistics are so alarming one should be familiar with the three categories of fraud; Management Fraud, Employee Fraud, and External Fraud.

Management Fraud often involves a senior management’s intentional misrepresentation of financial statements, theft or improper use of company resources. Employee Fraud involves a non-senior employee theft or improper use of company resources. Lastly, External Fraud is the theft or improper use of resources by people who are neither management, nor employees of the firm.

Indications of fraud generally fall into a few categories: Accounting Anomalies, Internal Control Symptoms, Analytical Symptoms, Lifestyle Symptoms and Behavioral Symptoms. The prevalent warning signs of fraud may include accounting record discrepancies, unusual transactions, and conflicting or missing evidential/supporting documentation. If a business has not been producing the profits it anticipated, it might be advisable to conduct a fraud audit sooner rather than later. One can draw a direct connection between unexpectedly lower revenues (or business losses) and possible patterns of fraud.

It is very important to maintain strict confidentiality regarding such matters. Some common mistakes businesses make is failing to retain counsel when fraud is uncovered or suspected, and/or not engaging the services of independent fraud investigators or a forensic team. If criminal or civil charges are pursued, an independent forensic accounting firm may be necessary.

Employee fraud is common, but not as inconsequential as the common cold. To help protect their clients, attorneys should be more cognizant of the various types of employee fraud.

To read about “The Fraud Triangle” and learn more about the forensic accounting services MSG provides, please visit our Web site at For the most up to date discussions on financial topics pertinent to business valuation, forensic accounting and litigation support, please visit our blog at
About The Author

Mark S. Gottlieb, CPA, PC is an accomplished forensic accounting and business valuation specialist with expertise in record reconstruction and litigation support.

Don’t Let Election Scammers Count on Your Support This Election Season

Scammers are already gearing up for this year’s Presidential election, from robocalls offering a “free cruise” for taking a political survey, to promises that President Obama will pay your utility bill. Better Business Bureau is advising voters to be on the lookout for the growing number of scams that are likely to continue leading up to the Presidential election.

“Scammers use incentives based on what they think voters want to hear,” noted Katherine Hutt, spokesperson for the Council of Better Business Bureaus. “Hot topics like health care, economic recovery and unemployment, are sure to be the alluring topics this election season, but it can be anything in the news that makes the pitch sound more realistic.”

Here are just a few of the election-related scams BBB is hearing about. Don’t fall for them!

There will not be a “free cruise” at the end of the voting survey. The public opinion poll scam typically involves a recorded announcement offering a “free cruise” in exchange for participating in a telephone survey.  At the end of the call consumers are asked for a debit or credit card number to cover “port fees” and taxes.  Consumers who hesitate or ask if they can call back in order to verify the caller’s identity are subject to high-pressure tactics, such as being told that the offer “is only good right now,” and that if they hang up they will be disqualified.

President Obama is not going to pay your utility bill. As nice as that would be, it’s not going to happen. Consumers have been contacted through fliers, social media, text messages, and even door-to-door with claims that President Obama is providing credits or applying payments to utility bills. Scammers claim they need the consumers’ Social Security and bank routing numbers to arrange the payments. In return, customers are given a phony bank routing number that will supposedly pay their utility bills. In reality, there is no money, and customers believe they have paid their bills when in fact they have not. Worse, they’ve just given away everything needed for identity fraud.

Fundraising calls for political donations may not be real. Consumers have reported calls from organizations that sound legitimate, but may not really be related to either the Obama or Romney campaigns. If you aren’t sure, don’t donate over the phone. If you’d like to contribute to a political campaign or party, locate contact information yourself rather than giving out financial information to a caller. Requesting a callback number is no guarantee you will be connected with a legitimate campaign fundraising committee. Call or visit candidates’ websites to obtain contact information to make donation. No one will check your eligibility to vote. Your voter registration record is with your state and no one is going to call or email you to verify your eligibility. What do these callers claim they need to check? Just your credit card or Social Security number. No way!

Don’t fall for these scams. Legitimate polling companies will never offer prizes for participating in a telephone survey, nor ask for a credit card number. Never provide your Social Security number, credit card number or banking information to anyone requesting it over the phone or at your home unless you initiated the contact and feel confident with whom you are speaking. Do not give in to high pressure tactics, whether over the phone or in person.

Gifting Programs – Legal or Scam?

by: Anne Wolski

In recent years there has been an influx of gifting programs across the internet. Gifting is where someone starts a gifting club where they claim that peoplewill make loads of cash by recruiting others into the club. There is an entry fee that can range from as little as $25 up to as much as $10000. The idea is that you pay this fee and then recruit others to pay that same amount.

You have to recruit quite a few people before you actually see any money yourself and, in all probability, you will never get to that point. I believe it is about eight people to get you to senior level where you collect some money.

Basically, all you get for your investment is membership in the club and the ability to recruit after getting a couple of people to throw away their money with promises of riches.

Initially, these programs seem very enticing and have a lot to recommend them but BEWARE. This is all a part of the SCAM.

One of the things about these programs that make them very enticing is the hint of generosity and the sharing of money with others. You even get money for being so kind but, in reality, the only ones you are being generous toward is those at the upper end of the program…the people who started it.

If you enquire about legality, you would be told that they have found a loophole or that their lawyers have told them it is legal because they are gifts. However, these gifting programs are nothing different from the illegal pyramid schemes. None of these programs are legal regardless of what they try to tell you.

What makes it illegal is that people are not truly giving a gift but they are making an investment with the expectation of a return. People running these scams are preying on people’s financial insecurities or greed.

Eventually, these programs crash and, unless you have become a senior member of the club, you can kiss your investment goodbye. You may also have to pay back people who have lost their money by succumbing to your recruitment. If you are a senior, you are responsible for everyone under you. It can become very ugly.

So, the advice I offer is to steer very clear of these programs. Not only can it create severe financial hardship for you but it can also put you in trouble with the law.

They will all tell you that they are the real deal and are different to others but they are lying in order to suck you in. all gifting programs are illegal.

So, keep your money in your wallet and look for something legal to invest in. there are many programs such as affiliate marketing where you can make money if you put in the effort. That way, you can make an income without breaking the law.
About The Author

Anne has worked primarily within health and welfare for around 35 years. She has always loved to write and has a wide range of interests. She is the owner of and