The Gateway Fraud: How Organized Crime is Using Accident Benefits to Exploit Vulnerable Canadians

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Accident benefits are part of every driver’s insurance coverage and provides compensation when the driver, passenger or pedestrian is injured because of a collision. When used authentically, accident benefits can help with medical and rehabilitation benefits, as well as caregiver assistance. When used fraudulently, criminals exploit accident benefits which can result in vulnerable, injured individuals not receiving proper care, funds being redirected to organized crime networks, and higher premiums for honest, hardworking Canadians.

Why are we calling accident benefits fraud the ‘gateway fraud’? It is the entry point for deeply complex and sophisticated organized fraud networks. For example, an unreliable healthcare centre may collude with a tow truck and vehicle rental company with the goal of finding a recent collision and exploiting the injured driver’s vulnerability. This may include maximizing accident benefits pay outs without providing total care claimed to the injured person. The fraudulent funds are then used to fund organized crime networks, while the injured individual is left without proper or fulsome care.  

These cases require specialized investigations and typically include other types of illegal activity such as synthetic identity fraud. Équité Association specializes in uncovering fraudulent patterns within claims and our investigators guide our insurance industry members to identify, predict and prevent continuing fraud. With the introduction of ÉQ Insights, Équité has built a foundation to detect and prevent insurance crime using predictive analytics and machine learning. By merging expert investigative insights with Équité’s ground breaking data platform, we can start to move the industry to a ‘predict and prevent’ model and, ultimately, make a meaningful reduction of these crimes in Canada.

While the scope of accident benefits fraud is expansive, there are things that individuals can do to protect themselves and their loved ones from being exploited. Below are tips that insurers, brokers and agents can share with their customers to mitigate the impact of accident benefits fraud:

• Speak to your insurance company or broker/agent: insurers are able to provide resources, answer questions and guide claimants through the process.
• Visit a trusted healthcare professional, such as a family doctor who knows your medical history and can guide your care.
• Educate yourself on accident benefits fraud: being able to easily identify fraud and to ensure your insurance coverage is only billed for care you received, is the first step to prevent yourself from becoming a victim.

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