MAINTAINING AN ETHICAL CULTURE AND MANAGING FRAUD
Stronger controls mean a more robust business environment. Santam subscribes to a zero-tolerance approach, which acts as a strong deterrent and can be considered a benchmark of best practice within the short-term insurance sector. Santam Forensic Services has adopted a multi-dimensional fraud-fighting model comprising fraud deterrence, fraud prevention, searching for fraud and fraud investigation. Fraud prevention is also a component of risk management and includes creating an environment that inhibits fraud. This is achieved through proper background and vetting processes.
There are two types of fraudulent activity – opportunistic fraud and organised fraud – and these are addressed differently. Opportunistic fraud is usually perpetrated by an individual who inflates his claim without any premeditated intent to defraud. Organised fraud is a well-planned, complex or elaborate scheme perpetrated by an individual or an organised group.
We combat opportunistic fraud by influencing behavioural change through awareness and education initiatives. Internally, staff at all levels are trained to be aware of fraud at work, and to understand their role in identifying, preventing and reporting incidents of fraud. We also hold various training sessions with brokers and use our internal broker publication, Focus, to convey fraud prevention messages. Externally, we are developing a marketing campaign to create awareness of fraud. We currently use the South African Insurance Crime Bureau (SAICB) platform to create awareness among external parties.
Effective use of technology plays a vital role in identifying patterns and trends associated with organised fraud. Numerous insurance fraud scams exist, and to stay abreast of these, we scan media sources regularly to identify new fraud trends, convicted fraudsters and potential underwriting risks. All relevant information is documented and circulated as an intelligence report to management.
Fraud investigation is a structured process that focuses on gathering sufficient reliable information to enable an investigator to either prove or disprove allegations received. When the conduct that is the subject of an investigation amounts to a criminal offence, Forensic Services will lodge a complaint with the relevant law enforcement agency and will assist the agency to investigate, charge and prosecute the offending party. By implementing measures that will increase the chance of detecting fraud before it reaches significant levels, we aim to reduce the incidence of fraud.