Proceedings of the webinar “Insurance fraud prevention- Legal and Operational Handbook for Insurers and Mutual Societies”.

Proceedings of the webinar presenting the volume

“Insurance fraud prevention- Legal and Operational Handbook for Insurers and Mutual Societies”.

The presentation of the book “Antifrode assicurativa – Manuale giuridico operativo per le assicurazioni e le mutue” ( Insurance Anti-fraud. Legal handbook for Insurances and Mutuals) Rubbettino Editore – Collana studi Eurispes) took place on 16 March 2022.

The book stems from the authors’ aim to provide the reader with their professional experience gained in the insurance sector and in civil and criminal courts. The manual opens with an introduction by the President of Eurispes, Gian Maria Fara.

The webinar presentation was opened by Angelo Caliendo, Member of the Eurispes Board of Directors, and the debate was attended by Antonio R. De Pascalis, Central Director of the IVASS Study and Data Management Service, Umberto Guidoni, Co-Director General of ANIA, Sergio Mattiuz, CEO of ANIA SAFE, Maurizio Vitale, Managing Director of WIT S.r.l. took part in the debate.

The authors of the book Luigi Peyron, Gabriele Galeazzi and Andrea Strata also spoke.

The conclusions of the meeting were entrusted to Nicola Graziano, Magistrate.

The proceedings of the webinar are available below

Webinar

Presentation “Insurance Fraud – Legal Handbook for Insurance and Mutual Insurance Companies”.

March 16, 2022 at 16.00

 

ANGELO CALIENDO: Good afternoon, everyone. Thank you to the speakers today for the presentation of this important book on insurance fraud, an important and delicate phenomenon which is in the Institute’s area of expertise. Before I begin, I would like to convey the greetings of our President, Professor Gian Maria Fara, who, due to other commitments, was unable to attend the presentation today, but who was very keen to do so, especially in view of the subject matter and theme. The Institute, as many of you know, has a special relationship with the law enforcement agencies; we have an agreement with the National Anti-Mafia Prosecutor’s Office for the study and in-depth analysis of security issues; above all, the Institute has linked its history to the study and predictive analysis of fraudulent phenomena on a wider scale. So we could not but welcome the proposal that we received from the authors of the book, namely to include this book in the Institute’s editorial collection. Among the authors I would like to greet today and thank for being here, I would like to mention our colleague Andrea Strata, who at Eurispes, together with another colleague, Chiara Sambaldi, directs the Osservatorio Giochi Legalità e Patologie (Gaming, Legality and Pathology Observatory), dealing among other things with the phenomenon of anti-fraud in the gaming sector. This led to the study of insurance fraud, which gave rise to the research for this book, which is the Institute’s first step towards a more in-depth study of the insurance fraud phenomenon. This is an important topic, because insurance fraud does not only affect the relationship between insurance companies and the person who commits acts that are criminally detectable and so fraudulent, but it affects the relationship with citizens, with consumers who find themselves in need of contracting an insurance policy. Therefore, due to these fraudulent episodes, there is an ongoing discussion on the cost of insurance, which on the one hand is compulsory (I am referring to third party motor liability), but on the other hand, especially in some Italian regions, has high costs. I will be brief because, as a lawyer and a professional, I also want to listen to the speeches, so I would like to thank the prestigious panel of speakers who have made themselves available to us today, and I will now hand the floor to Mr Antonio De Pascalis, Central Director of the IVASS Study and Data Management Service.

 

ANTONIO DE PASCALIS: Thank you, I thank Eurispes and the authors Peyron, Galeazzi and Strata. I would like to thank you above all for publishing this book, and then for inviting us, and these are not idle thanks. When you are invited to a conference, to a presentation, to a workshop, you obviously open with greetings. They are really heartfelt because it is something that was missing. Insurance anti-fraud is often mentioned, it’s a subject that is very much subject to rhetorical debate, I was thinking that it’s something like the fight against tax evasion, so all the time. Then, when you are working every day, you may encounter some difficulty in actually implementing what is said about insurance fraud, due to a series of problems that are also highlighted in this book. Browsing through and picking it out because as soon as it was delivered to me I was very curious and interested, I saw that it is a very complete book, despite the subject matter it is concise. It is a fairly quick read that manages to enclose all the problems that those who work in anti-fraud obviously face every day. Browsing quickly I read “The fraud committed abroad to the detriment of Italian insurers”, “In the criminal trial the territorial jurisdiction” a major problem that still persists and that should be solved, the one on the territorial jurisdiction in civil law profiles; I see “The coordination with the anti-fraud actions carried out in criminal cases with the civil actions”, “The defensive investigations and their coordination with the legislation on privacy” and then the whole discussion concerning the rules on the privacy and treatment of personal data in insurance. The chapter ends with a comparative look at insurance fraud abroad – we at IVASS should be publishing something on this soon. At the end we have the chapter with the tools to fight fraud: a very interesting overview is given on the instruments to fight fraud, but this is an area in which the Institute has done a lot in recent years, it has done a lot to offer tools to those who work, those who work every day, to combat insurance fraud. And the work is not over, it is still in progress. In addition to a change in the technological platform, there is an extension of the tracks that will allow us to combat fraud more effectively and link up with the integrated anti-fraud archive; the extension of the databases that will be linked to the integrated anti-fraud archive is a work in progress, as is the implementation of network analysis. It was mentioned that you collaborate with the National Anti-Mafia Prosecutor’s Office and therefore your predictive models. We have built one, it is the deterministic model, but practically we have made an analysis and created a system based on networks analysis. In the model that we have developed also in collaboration with the University of Palermo, which has collaborated with the Anti-Mafia Prosecutor’s Office on the same subject, therefore, we have followed, more or less, the same criteria. Only one mention is made of underwriting fraud when it comes to documentary checks on the data accuracy; underwriting fraud is often mistaken because it is interpreted as a predictive model to be used in product pricing. Specifically, in the third party motor liability line of business, it would be absolutely outlawed, but it is another thing to be used in the mere control of data in the recruitment phase and therefore in part already applicable, perhaps with reference to what we can still do to increase this activity of recruitment fraud and think of a system that allows us to control the reliability and integrity of the data and documents submitted in the recruitment phase. It is continuous control of the persistence of the requirements. Let me give you a rather trivial example: if I live in Aosta, in a province where the rate of third party liability for motor vehicles is very low, the next day I might move to a province with a very high rate coefficient, or if I qualify for benefits or discounts and the next day I lose them. So what would probably be needed is a permanent check on the fulfilment of the requirements and the declarations made when signing the insurance contract. But I don’t want to take up any more of your time, perhaps I shall come back to it later. I realise that maybe the only negative note of the event is that too little time was set aside to speak, as, in addition to the book presentation, it was perhaps a topic on which each of us would have a lot to say. A final negative note, in this case, when we talk about fraud committed abroad against an Italian insurer, there is a question: ‘In order to conceal his car legally registered in Italy, Mr. X, an Italian citizen, exports it abroad in order to unduly obtain the insurance premium’. So, this improper use of the term “premium”, now you will answer me “but we have reported a question as it was formulated, because it is quoted, it is described in italics” I would have put open brackets “rectius compensation” as well “I would have put “n.d.r. recitius compensation” as well as “compensation” in brackets, precisely because the dissemination of insurance culture – this is a small example – must also be one of our objectives. Yet, this is a venial sin, because in our survey on the insurance culture among Italians, one of the main problems is precisely the confusion, and by “premium” most people mean the indemnity, the compensation, and not the price paid for purchasing the insurance coverage. Thanks again.

 

LUIGI PEYRON: Thank you very much Mr De Pascalis for all these insights that you have provided. In the next lockdown we will be writing a book on underwriting fraud, let’s all hope we don’t have to write it! I will now pass the floor to Mr Guidoni, Co-Director General of ANIA, because we are interested in understanding what the vision of the trade association is in the area of anti-fraud.

 

UMBERTO GUIDONI: A good afternoon to everyone, and thank you. I would like to add to what you have just said, let’s hope that you don’t have to write a book on underwriting fraud because IVASS will allow us to do so, given that today underwriting fraud cannot be done beyond small matters. Thank you very much for the invitation, the book you have published is certainly a good pretext to talk about a subject that is creeping, sometimes even counterproductive for companies and, therefore, being able to get to the heart of the matter and try to make the problem as popular as possible is, in my opinion, extremely important. So I thank the authors for this in-depth study. I like the book for two aspects: the first is the role attributed to insurance companies, a role that is certainly strong and much more evolved than the fight against fraud that companies have taken on in recent times. More importantly, it is the ability to coordinate all the players working around the claim (from the investigator to the legal doctor, the trustee lawyer, and the company officers themselves). Therefore, it is precisely through coordinating this intervention logic that it is possible to succeed in preventing and combating fraud.  Furthermore, we as an association have worked on this logic in recent years, trying to pool the resources at our disposal by doing what we can, clearly in compliance with the regulations in force, but trying to coordinate the activities of the companies with a whole series of players, as I was saying before: lawyers, legal experts and investigators, property experts, to give a logic that is not only a professional deontological intervention, but rather in a logic of intervention in which the company acts as director and all the actors around must move according to a strategy that is to be able to identify the fraudulent phenomena, pursue them and clearly produce a benefit for the all system. Because we must not forget that fraud is a cost factor that is passed on in premiums, whatever insurance class we are talking about. Therefore, it is first and foremost a social factor, but also an economic business factor for companies, because it represents an effective saving (which we would like to try to calculate in our next survey). This was the first point we worked on. The second point on which we worked, and which, therefore, can also be found in the approach adopted in the writing of the book, is that of trying to put companies in a position to learn about fraudulent phenomena. We have very serious associative issues in these crimes, with the collection of money that is then used for even more serious crimes (drugs or heavy associative criminal phenomena) and we have found a very complex condition for companies to be able to exchange information on the phenomena that precisely characterise these factors. The frequency of particular types of claims and the territorial location can sometimes be an indication of the presence of an associative phenomenon. We have created a platform on this, and have worked hard on it. It has been approved by the Antitrust Authority, and today this is a system that works in vehicles and that can certainly help us to identify this particular form of fraud, which is one of the most dangerous, let’s say, compared to those that are more widespread but have less impact from a criminal point of view. The third step was to say: well, we know practically everything about cars; we know that one in four claims is at risk of fraud; we know that in some areas 40% of reported claims are at risk of fraud; we know what insurance companies do, through their reports, and therefore we also know what the savings are; we know that there is a commitment to trying to develop increasingly important innovative processes in this area. We have somewhat forgotten until now about everything that happens in the non-motor sector, which is not negligible, because the first thing we noticed, for example, is that there is a quite similar trend between the economic cycle and fraud in the non-motor sector too. Usually, there is a slight delay in the cycle, so there is no overlap in the trend. However, it is clear that, for example, during the lockdown period, since there was very little traffic, fraud was carried out on the entire property sector, and shed fires are certainly a widespread phenomenon, as well as housing issues and things like that. So we told ourselves that it was necessary to build an anti-fraud database on the non-car sector as well, clearly with criteria that must take into account all the requirements and specific needs that an association such as ANIA has to make. Therefore, we went through the Antitrust Authority, which gave us the go-ahead, and we are in the process of evaluation by the Guarantor. I am very pleased to say that IVASS is also involved, at least in the last hearing held on an investigation into consumers, expressed the need for a non-auto database on this type of issue, because it clearly believes that this could be a useful tool both for supervisory action and for companies in the doubtful phase to deal with a phenomenon that causes the Country-System and companies to lose tens of millions of euros. I would like to close by emphasising another aspect that according to us, to me, is very specific in the book, and that is the social value that has been highlighted of insurance, which is linked to the social profile of the fraudster. Reading this part, I must say that in my opinion there is a very important logical connection here, because a few years ago with the ANIA foundation we carried out a survey on the awareness about the insurance system and fraud. Here the theme is paradoxical: those who defraud are particularly well educated with respect to insurance issues and solutions. In other words, let’s say the insurance subculture, which unfortunately is a phenomenon that we have to fight, that we are constantly trying to combat, is actually a positive factor here because those who commit fraud are particularly familiar with insurance solutions and also have a rather high level of culture. So to detect this in the book seems to me to be the correct approach, because basically, starting from that profile, it is possible to have prevention instruments that allow us, at least, to create those safeguards. These are necessary in the insurance industry in order to be able to take advantage of the opportunities offered by the law, particularly with the regulatory instruments that we have at our disposal today (and I must say that the impossibility of carrying out anti-fraud measures in the implementation phase is a flaw in the law). They are also useful to trace these profiles and they are very helpful in prevention activities. And on this, I have to say that insurance companies have invested and are investing a lot and we hope that in the near future this phenomenon will be less and less impacting compared to the economic damage it creates to the Country-System, first of all, but also to the overall insurance system. I thank you and above all, I thank you for having had the opportunity to discuss these issues.

 

ANDREA STRATA: Mr Guidoni, thank you very much, while you were speaking I took a few notes because intentionally or unintentionally you gave us some important assistance. The first is the need for coordination and teamwork, which for us is one of the strong points that we have highlighted several times in the book and that too often little is done, much more should be done in the area of anti-fraud. The second assist you have given us is on the non-car. We have dealt with a large number of practical cases that I hope will be useful for operators in the sector, covering all lines of business, not just third-party motor liability but also non-car, in the knowledge that fraud is moving in that direction too. The third concerns the ” headquarters ” that is hosting us today, the Eurispes research institute, which, as Mr Caliendo said earlier, is the Institute for Economic and Social Policy Studies, and you mentioned the word “social”, which is why the Institute is very interested in fraudulent phenomena because it is part of Eurispes’ institutional focus. I won’t say more, now it’s time for Luigi Peyron, who represents to us the vision of the insurance industry, having more than 35 years’ experience in this sector and having crossed the most critical situations in Italy.

 

LUIGI PEYRON: Thank you all, thank you to the speakers who have spoken before me, whom I greet with sympathy and also to those who will follow. A special thanks also to Eurispes who is hosting us and who organised this day and in particular to President Fara who wanted to make us the gift of a beautiful preface to our book as well as introducing this book to the Institute’s publications. When we were just at the beginning of the pandemic, i.e. during the first lockdown, Gabriele phoned me and asked me to write this book together with Andrea, and I immediately said yes. Of course, it is a valuable work to deal with this issue, which was actually missing, and the structured form of a book is a theme that for Eurispes is part of its institutional tasks. Besides, it must be said that insurance fraud receives an unreasonable overindulgence that tends to diminish the great social value of this issue. I would add, and we talk about this in the book, that the legislator has also intervened a little late on these issues, driven, as we said, by the rise in rates. It has to be said that in the courts, 642, the crime of insurance fraud, is often considered a trivial offence and is often overlooked. I would add that I come from the corporate sector, and even the companies have not always shown due, and I would say spontaneous, attention to these issues. But I’ll make a confession: these very noble reasons are not the ones that convinced me to say yes to Gabriele; There is a saying that I remember, perhaps Chinese but I am not sure, that in life a man must at least have a child, plant a tree and write a book. I have five children, all with the same wife, I don’t know if she listens to me, but in the meantime, I thank her for all the herbal teas she brought me late at night when I was writing. I have planted many trees, but I have never written a book, so this much more ordinary reason pushed me to say a strong yes. Of course, when I then put down the phone I realised there was a problem, actually two big problems that immediately crossed my mind. The first: will we be able to write a book on such an immense subject? The subject has already been mentioned a bit, it is in continuous evolution, in continuous ebullition. No company, not even the most structured, with the best organisational structure, with the perfect algorithm machine learning, with the best system for detecting fake photos, with the best fiduciary network, can say that it has achieved a result in anti-fraud. It is a challenge on a constantly shifting frontier and no one can ever say they have achieved that goal. I was reassured by the fact that I was not facing this challenge alone but with the expertise certainly of those who have worked in companies, but also of those who have worked in civil and criminal courtrooms. The second doubt that came to my mind was perhaps a little more subtle, almost philosophical. Were we not in danger, through a perverse, shall we say, heterogenesis of ends, of achieving the opposite of what we had intended? Let me put it in other words. Were we not in danger of somehow suggesting our counter-moves to those we wanted to fight, our strategies, our tricks? A bit like the magician somehow revealing his tricks; that could have been a problem. We’ll say it straight away, we didn’t invent anything, we just collected the different experiences, the skills, we tried to put it all together, sort it out and give it back to you, in the form of a book. We are aware that companies actually have a major competitive disadvantage compared to those who want to perpetrate fraud. I will try to say this with an example that I like, by quoting a Sergio Leone film “A Fistful of Dollars” (1964). Many of you have probably seen it and remember the final scene: on one side there is the good guy, the American one, Clint Eastwood the man with the gun and on the other side there is Ramon, Gian Maria Volonté, the bad guy, the man with the gun. The phrase that is always repeated in the film: “when a man with a rifle meets a man with a gun, the man with the gun is a dead man”. Thus, the fraudster is somehow holding the long gun, the rifle of information asymmetry. He knows the scene of the accident, the best time in which the fraud could take place, he has the surprise effect, he chooses the time and the way. The man who wants to combat fraud, on the other hand, also has on his side, as we have often said, the legislation that does not always help him and the costs, because we must not forget that combating fraud is much more expensive than carrying it out. However, without wanting to spoil the film, which you all know anyway, in the end, the man with the gun wins, because he shoots his bullets well. And among the bullets there is certainly the timeliness of the intervention, there is a good network of trustees, legal practitioners, experts, informers, civil and criminal lawyers, but there is also the theoretical knowledge of the skills, and this is a bit of the meaning of this book. In order not to take away space from others, I would like to give the floor to Gabriele who, besides being a friend with whom, during my long period in Rome, we did a lot of climbing and skiing together, is a criminal lawyer. But most importantly, and this was a great contribution to the book, Gabriele also had experience as a manager of the Chancellery of the Court of Appeal in Rome. And this is an expertise that has been useful to us, it’s a bit of a behind-the-scenes look at the scenario of Piazzale Clodio (Italian Ministry of Justice address) . I leave the floor to you.

 

GABRIELE GALEAZZI: Thank you Luigi, good afternoon everyone. Mr De Pascalis, I am going straight to the point, referring to the well-known issues related to the territorial jurisdiction of the insurance fraud offence. It is an issue that is very important to me as a criminal lawyer. We all know that, in essence, with some pronouncements, first by the General Prosecutor’s Office at the Supreme Court, then by the Supreme Court, back in 2012, the principle of locus commissi delicti was somewhat circumvented with a very questionable, very singular principle. How was it circumvented? With a series of harmful effects, as we lawyers witness, but also the companies see every day in the repression of insurance fraud. The Supreme Court’s argument is very simple: they say, in essence, since the claim is false, it never took place. Actually, the offence would be completed with the claim for damages forwarded to the company’s registered office. It is true that the claim is false, but the actors, I tell myself, and the extras, are real and are flesh and blood. Mr. Guidoni referred to organised crime phenomena in the territory. What has this principle established by the Court of Cassation led to? I would like to point out that the main actors, who are the organisers of the frauds and the extras, i.e. experts, counterparties, lawyers, coachbuilders and witnesses, have moved from the open scene of the crime to the fictitious scene of the company’s registered office, with detrimental effects. What are these effects? We have tried to highlight these effects in the book and we also point them out in training courses. There is a centralisation of jurisdiction on a few courts, which are already afflicted by a high number of criminal trials. There are centralised investigations hundreds of kilometres away from the scene of the crime, with public prosecutors and judicial police who are often detached, often not even interested in investigating certain territorial contexts where certainly insurance fraud, as Mr. Guidoni said, is inextricably linked to the phenomenon of organised crime and money laundering. But then, and the anti-fraud managers of the companies know this, there are other harmful effects and, among these, there is the risk of judicial drifts or measures which we see as excessively punitive: some offices of the Public Prosecutor’s Office, some Public Prosecutors, in order to limit the high number of complaints-questions which are filed in their offices, systematically advance requests for dismissal. In addition to the damage, the companies have to bear all the costs of transferring witnesses, experts, lawyers and, of course, private investigators from one area to another where the trial is taking place. Let’s imagine a witness who has to travel from Naples to Milan to testify on the same day (i.e. round trip). We know that many trials are cancelled and fail because the witness from Naples will never come to Milan. I would say that this is a bit of judicial madness, because given also the recent increases of the cost of fuel I am joking here – why make the injured party and therefore the company bear such an excessive cost? I take advantage of this institutional meeting precisely to launch a “virtual petition”: perhaps the time has come to modify Article 642 of the Criminal Code as far as the profiles of the territorial jurisdiction are concerned. I will go very quickly, because I do not want to bore our audience. The other issue, unfortunately, concerns and is inextricably linked to the world of insurance fraud, the notorious delays in criminal trials. Someone, Montesquieu, said that ‘justice delayed is justice denied, and I absolutely agree. The PNRR’s trial office has recently been introduced, because even the judiciary realises that it is necessary to give support, an impetus to judicial activity. How can an insurance company, in the context of the anti-fraud activity, give this impulse, because the contribution in the formation of evidence by the company is of paramount importance. Now it is an active role, it can no longer be a passive role, especially in the phase of preliminary investigations, which are the really long ones and where the complaints and claims by the companies get stuck. So the question comes to me naturally: what can be the cure for the disease of fraud with a doctor, the Public Prosecutor, who is involved in far more important cases than ours? The cure, in my opinion, is in the formation of the evidence, that is, in the use of high-profile investigative instruments, which can give impetus to the preliminary investigation phase, where all the complaints are stuck, and this would allow, and believe that experience teaches us this, to neutralize the risk of dismissal of criminal proceedings and the risk of prescription of crimes. We have to work upstream, we have to work at the stage of preliminary investigations, of preventive investigations, on the construction of circumstantial elements that basically allow the Public Prosecutor’s Office to assess the company’s information dossier and, once assessed, to exercise criminal prosecution. But if we hope that this is done by the Prosecutor’s Office, as Luigi was saying, they will consider it a bagatelle offence and, therefore, they will not make an effort to investigate for us. The other aspect I’d like to highlight, where we can make a difference, is anti-fraud investigations that are detached from the claim settlement phase. We are in two completely different spheres, and in my personal opinion the anti-fraud office should seek out evidence independently from the activities of the other offices, in an absolutely autonomous and self-referential manner with respect to the activities carried out by other company structures which are responsible, for example, for the claim settlement phase. I have concluded, and I would like to leave the floor to my colleague and friend Andrea Strata, who will have the task of providing us with some suggestions. Andrea, I must say, is not joking, he is on his fifth book, clearly he is not tired yet, so we will probably find him again as the author of other books, perhaps the one on recruitment fraud. He also deals with anti-fraud in the insurance sector and in the gaming sector, where he is Co-Director of the Gaming, Legality and Pathologies Observatory on behalf of Eurispes.

 

ANDREA STRATA: Thank you Gabriele, I am on my fifth book, Luigi on his fifth child, let’s say I have dedicated myself to writing. Jokes aside, Luigi Peyron spoke to us about the blunt weapon of us anti-fraud operators and Gabriele Galeazzi dealt critically with the formulation of the crime of insurance fraud, 642 (with particular reference to the problem of territorial jurisdiction); I will try to provide a proactive idea, some practical cases, which is one of the primary objectives that we have tried to achieve with our book. We wanted to put our professional and multidisciplinary experience “down on paper”, with the ultimate aim of providing a working tool, an aid to all anti-fraud operators. Currently, fraud is always (and almost exclusively) fought in criminal court, with the proceedings originating from the complaint filed by the insurance company that considers itself the victim of fraud. In fact, experience in the courts teaches us that we should learn to play more and more on a “double track”: the civil and the criminal track. In fact, I would go further: in this field, we must necessarily overcome the dichotomy between “civil” and “criminal” by learning to combine the two areas of expertise; using the civil and criminal procedure to our advantage; knowing, at the same time, the weaknesses of the two areas; intersecting, as far as possible, the tools of one area with the other and vice versa. Of course, I am not saying that complaints should not be filed. I am saying, however, that the number of the archiving of criminal proceedings is very high: it is estimated that over 60% of the proceedings are archived by the Public Prosecutor’s Office. If we were to analyse the specific crime provided for by Article 642 of the Criminal Code, precisely because, as the other authors said, we are talking about a crime unfortunately considered “trivial”, this percentage would increase. On this issue, I invite all of you to read the 2nd Report on the Criminal Process drawn up by Eurispes, which has examined the situation of justice in Italy in a huge amount of work, analysing over 13,700 trials and 32 courts. If we want, therefore, to fight fraud more effectively, perhaps we must look in other directions, we must look at civil law, and we must use the tools of criminal procedure also from a civil law perspective. To mention just a few practical examples relating to the ‘double track’ strategy: how can we get a civil case suspended? Think of the case of the insured who on the one hand is a claimant in a civil case because he is demanding payment of insurance compensation, and on the other hand is simultaneously under investigation in criminal proceedings for insurance fraud. So we have the same subject, the same parties “reversed”, so to speak. How do we get a civil case suspended in this case? Clearly I am talking about the institute of criminal bias expressly provided for in an article of the Code of Civil Procedure (art. 295). For the experts in the matter, we know very well that the civil Judge will hardly come after us, because the requirements to obtain the suspension of the civil case are absolutely stringent. Why, then, not turning to criminal law and ask the Public Prosecutor to seize the documentation, the file, of the civil case in order to avoid that the crime is taken to further consequences. And why, for example, not also request the Public Prosecutor to intervene in the case provided for by Article 70 of the Code of Civil Procedure? You might say, they never do it anyway; it’s true, but we never ask for it, we forget these instruments, we don’t know them. And yet, the anti-fraud protocols signed by ANIA with some public prosecutor’s offices also mention them. Another example is the incompatibility of claims, not only in the area of third party motor liability but generally all incompatibilities (fire, theft, injury, etc.). Criminal proceedings are always initiated with a complaint and a report by the company’s trustee, and the case is always dropped. But why not, for example, act by means of a preliminary technical assessment aimed at reconciling the dispute (art. 696 bis c.p.c.). I am not saying to conciliate where we have been defrauded. It seems a paradox: how can I conciliate if I am the victim of fraud? Look, it is only a procedural contrivance to obtain the technical opinion of an OTC, i.e. a third party with respect to the Company’s trustee, to reinforce the incompatibility report drawn up by the Company’s trustee; to change the outlook ( forgive me for saying so, the psychological aspect) of the magistrate, who usually has to judge cases where the Company has not settled the claim… on the contrary, in this case, it is the insurance company that turns to the magistrate to resolve the issue from a technical point of view. If it emerges during the preliminary examination that fraud is behind the incompatibility of the claims, then we will file a complaint, attaching the results that emerged during the preliminary examination (we will certainly have much more weight and it will be more difficult for the public prosecutor’s office to dismiss the case). One last example, but there are many in the book: the instrument of the defensive investigations that the defender can carry out, as provided for in Articles 391 bis et seq. of the Code of Criminal Procedure, introduced by Law 397/2000 in order to grant “equality of arms” between the prosecution and the defence. This is a very important tool in the field of anti-fraud, but it is rarely used and only in criminal proceedings. Why not also use it as a preventive measure, in order to gather evidence that may be useful not only in criminal proceedings but also in civil proceedings (where the insured has filed a lawsuit against the Company, which is obviously aimed at paying the insurance indemnity). I could go on much further, but I would like to leave room for the other much more distinguished speakers. I shall conclude with a message. To put the “double track” strategy into practice (knowing how to operate, at the right time, on two fronts, civil and criminal) requires, as Mr. Guidoni said at the beginning, perfect teamwork between all the anti-fraud operators – I am not referring, obviously, only to lawyers, but more generally to all the Company trustees: doctors, assessors, etc.; a specialisation and professionalisation of the figures operating in this area; a marked “anti-fraud culture” and on this I certainly applaud Eurispes, which wanted to include our book in its publication. A strong “anti-fraud culture” and on this certainly, praise is due to Eurispes, who wanted to include our book in the Institute’s series of publications, confirming the importance of this subject from an economic, social and political point of view.

 

LUIGI PEYRON: Thank you Andrea, I would now like to pass the floor to the CEO of ANIA Safe, Mr. Mattiuz, recalling also that everything started from our anti-fraud lectures in the ANIA Safe courses. Please.

 

SERGIO MATTIUZ: Thank you, thank you and good evening to everyone and thanks to the Eurispes Institute and thanks to the authors of this book, which has somewhat consolidated this training course that we have carried out together. Over the last two years, there have been several editions of the course: almost 60 companies have been trained, plus law firms and professionals. So I think it has been a very useful experience, very well followed with very positive feedback from the participants as well. So, I am not an anti-fraud expert and I am also the IT manager of ANIA. Thinking about this presentation event, I found many similarities between the anti-fraud theme and a theme that I deal with every day, which is the theme of combating cyber crime and hacking. I found some common factors, even quite obvious ones, which I would like to mention here. Yesterday, the last Clusit Report was presented, which showed that the weakest link in the security chain, even in the cyber sector, is the human factor, and therefore the importance of training and the preparation of people. The first point is awareness; this has also been mentioned by my predecessors and is well explained in the book. We are faced with a phenomenon that is socially tolerated to a very large extent. Therefore, in addition to the issue of training, I believe that the issue of communication is relevant and important, both for insiders, on this I am less well informed, but as in the cyber, how many times is it not a priority issue, it is not a matter with so much emphasis, because it is an expensive issue to set up effective anti-fraud structures, and therefore there is an issue both for insiders and for the consumer in general. It is important to be aware of the phenomenon that, as we said earlier, is harmful to everyone, and causes enormous social damage. The second aspect concerns complexity. Earlier someone mentioned the number of actors involved, different points of view. Now Andrea and Gabriele were talking about the criminal aspect, the civil aspect, the complexity, the number of perpetrators, and this complexity requires training, requires investment in people, so I am very happy that this book can serve as a basic manual. In the next few days, we will be launching an advanced anti-fraud training initiative – over the last two years, let’s say that this book is a bit of an offspring of this training course, we have focused on basic training – and therefore in-depth training; I hope that other more detailed books on the subject will be needed. The third aspect that I think is very similar to cyber issues is the theme of sharing, the importance of sharing. Sharing information, sharing events, sharing experiences, sharing solutions, both those attempted and those achieved. So, it has certainly been done in the training process, but that, how to say, is an occasional sharing and instead, I think it is very important to have moments and also have tools, as Mr. Guidoni mentioned earlier, just to regularly share information on fraudulent phenomena. In my opinion, the book provides a contribution to all these three aspects. Moreover, it is very readable, because it alternates very concrete practical examples with a more rigorous, more methodological approach including very precise references to legislation. Therefore, in my opinion, it is readable enough to be a candidate for a textbook on the subject. The last point I would like to mention, and in my opinion, it is very important, is the overview of the instruments used to combat fraud, both of a regulatory nature, i.e. the incentives – I am thinking of the third-party liability vehicle insurance and the card that are given to promote anti-fraud activities – and then we talked about instruments and innovation. Well, the book makes a fairly wide-ranging excursus, for example, as Mr De Pascalis said earlier, on some innovation tools, naturally some existing ones such as the BDS databases of Ivass rather than personal information and so on. And then there are some innovative features: there is an interesting discussion on the future of insurance, with the blockchain in smart contract. Then there are the issues, already mentioned before, of analytics, i.e. the analysis of this information, of these databases that, when available, are fundamental to be able to put on track effective solutions. I appreciated the point made about artificial intelligence, machine learning, analysis of the social relationships of individuals involved in accidents, and so on. I liked this aspect that it is never presented as a deterministic and decisive solution. The professional is always at the centre, so all these solutions are solutions to support a person, and I believe that in this activity, with one’s professionalism, with one’s expertise, with one’s experience, and I believe also with a good dose of awareness, one remains at the centre of all effective actions against insurance fraud. That is the end of my speech. Thank you all again for your attention.

 

LUIGI PEYRON: Thank you Sergio for the additional insights you have given us with this speech and for your nice words. Now I give the floor to Maurizio Vitale Co-founder and Managing Director of WIT, who has encouraged us from the beginning, believed in this project and supported it. Maurizio, if you want to say something, thank you.

 

MAURIZIO VITALE: Thank you Luigi, thank you. First of all let me thank those who are listening to us for the time they are dedicating to us. I would also like to thank President Fara, Eurispes, the speakers and all of you for the distinguished speeches. I believed in this initiative from the outset and I have encouraged my friend Peyron in this work from the moment he first mentioned it to me. Why? Because combating fraud is one of the main problems we have always had to deal with, especially when dealing with insurance claims. I fully agree with everything that has emerged from the various speeches. We have seen that this is not just a phenomenon that concerns third party motor liability. It concerns the world of motor insurance, primary insurance and health insurance. Often these phenomena are already evident in the underwriting phase. That is why the fundamental point is that we are always confronted with the effects of fraud when we identify these specific phenomena, and although we take action to combat them, sometimes the feeling we get is “like taking a paracetamol to combat a fever without investigating the reasons for the fever”. The point is to identify the reasons. It is a complex task that those who deal with claims can only partly manage. And so I would like to go back to the fundamental common theme, which authoritative previous speakers have expressed, that the collaboration of all operators in the sector is fundamental, including through the strengthening of cooperation with the supervisory and judicial authorities. We have an excellent working relationship with the companies, and often a few simple cases become interesting opportunities for study and investigation. Fighting fraud originating from an individual is easier: with experience, we have the organisation, technology, data analytics and artificial intelligence that certainly help us a lot. I have seen how investment has shifted from training people to IT applications with increasingly interesting results. Similarly, audit models on trustee networks have become increasingly sophisticated. So, in short, the claims handler is the terminal sensor in a fraud-fighting process: we identify individual cases, we activate the necessary actions, the necessary company functions, rather we research and report wider phenomena that require subsequent system action. Now, the handbook by Peyron, Galeazzi and Strata is certainly useful for transferring this knowledge, a greater awareness, exactly in line with the evolution of recent times. It is suitable not only for those who deal with claims settlement but for all those who are directly or indirectly affected by this phenomenon. So I am convinced that it will be a concrete contribution to business growth in the fight against fraud, and I can only basically suggest that we continue along this path. Thank you for your attention.

 

ANDREA STRATA: Mr Vitale, thank you very much for the compliments. I would also like to thank Dr Capuano, who I see in the chat room complimenting us, so thank you very much. I would now like to pass the floor to Mr Nicola Graziano, who is a magistrate, a civil judge at the Court of Naples as well as an Eurispes advisor, so he is part of the team. Please, Mr Graziano.

 

NICOLA GRAZIANO: Good evening, I apologise for the hoarse voice, but it was important to be there. Moreover, I must confess that I have listened with great interest to a debate of great importance, so I am truly grateful that I have been entrusted with the task of drawing conclusions after a debate of the highest level. I am honoured to be able to take part in it on behalf of the Institute, which has seen me play an active part in this ongoing research for many years, and this is certainly an extremely important topic. However, we must start with one consideration. I am even from Aversa, so the Casertano area where this struggle that exists between the Neapolitan and Casertano areas is even more prevalent. However, among the various ideas that you have given, I must refer to one in particular: several times you have all spoken of a reasonable indulgence, of tolerance of this phenomenon. Then I was very struck by the reflection of Mr. De Pascalis who, perhaps in a pessimistic way – I don’t know, maybe he will tell us how to interpret this remark of his – spoke of a rhetorical fact as if it were practically a generic and general word and referred to the so-called fight against evasion, which then, basically in terms of taxation, does not materialise in anything or everything. But fraud, someone else said, is a fact of social and also economic cost of business and social cost, I did not quite understand what was meant if not practically a tolerance of a social phenomenon that perhaps had a path where everyone could be a protagonist in some way. Pass me this very harsh thought but actually, this basically could be one of the allowances of this phenomenon or if this is really a phenomenon to be eradicated or not. And then Mr Peyron made a fundamental reflection: the contrast is a contrast that, if deliberately concrete, brings out that concept that he then identified with “the gun and rifle” that the State always wins. In this context, certainly, this book, which I read with great interest, struck me with many things – then I do not want to run out of time – but the concept of “occasional and professional fraudster” is an important concept because, in my opinion, it illustrates what is the occasion and what is the system. And I would like to say that here we are talking about the system, if we are all agreed, of this localised phenomenon in certain contexts, this associative phenomenon, where very often the criminal judiciary has intervened in our areas, but not necessarily as a result of the complaints referred to, but from an observation of a very serious, clamorous social phenomenon, perhaps to which no one could remain unaware. But after another point of the question, let’s say, without an answer, even if I must say that the criticism of the penal system, above all, and not also that of the delays of the civil system, I keep it, because this, in my opinion, also contributes to favour this phenomenon, because when a system does not work, it is possible to “twist the handle” and it is evident that this also gives another possibility so that the judiciary can take a minimum of responsibility in terms of disorganisation. I hope that this reform, which involves all sectors – criminal, civil, cassation, appeal – of the employees of the office for the trial in some way can give an answer to weaken this phenomenon, which, however, begins and continues in my opinion with that scene of “Così parlò bellavista” that my beloved friend, President Panzani, recounts at the beginning of his preface. He tells of how he was in some way invited to be a witness, even though he was a young magistrate, so he was not well known, and this scene from the film ‘Così parlò bellavista’, this Neapolitan film that you all know, in some way exemplifies this social cost and this tolerance, this unreasonable indulgence, this social tolerance. We clearly have to respond, because we believe in it, we are on the other side, and this is not possible. The path identified in this very interesting book is a very clear, precise and extremely stubborn path, so let’s welcome the five children and one book, and then five books and I don’t know how many children you have, lawyer, because if this is the basis for discussion. Then perhaps we are on the best path, and everyone has said so: synergy, collaboration, knowledge and sharing of the phenomenon news, the need to work together to eradicate this phenomenon. I say this to give an example that clearly seems inappropriate in some ways: in the 1970s the smuggling phenomenon boomed; I remember that at a certain point the State decided that there should be no more smuggled cigarettes on the streets, and I do not know, because I was young, the political, economic and social reasons for this decision, but that was it. So until we really decide to put an end to this economic and social chain on the other side, which is at the root of all this insurance fraud, I believe that we are facing obstacles. If we all finally decide to eradicate this phenomenon, I agree that the gun will win out over the rifle. They are many, we may be few, but we have authors like you three who have clear ideas that with training courses, with studies in the name of Eurispes, to which I belong with honour and pride, we can certainly be on the right side and be able to make a fundamental contribution to this phenomenon, and this is said by someone who is actually annoyed at having to buy a motorbike and pay €1,800-2. 000-2,200 euros a year for insurance, when, moving to Campobasso, you only pay €300 or €400, and this is something that we can no longer tolerate as citizens, as magistrates, as legal practitioners, and with this in mind, I leave you and I really thank you for choosing me as the person who could live up to the conclusions of this very interesting debate.

 

ANDREA STRATA: Mr Graziano thank you. The point of view of the judiciary and also your personal point of view is always really valuable to us. Having said that, I think it is appropriate, after the judiciary, also to give the floor back to the Supervisory Institute. So, I would ask Mr Antonio De Pascalis to make one last speech before the final greetings.

 

ANTONIO DE PASCALIS: Well done, because I have noted so much. So many interesting things have been said, especially by the magistrate who spoke a moment ago. There would be so much to talk about. If you give me 10 or 15 minutes at the most I will try to summarise, but they were all so interesting. I’ll start first with what you said about information “asymmetries”, which we always try to bridge to the detriment of insurance companies, because information asymmetries are very difficult, but that is precisely the purpose of our databases: to bridge information asymmetries to the benefit, above all, of small companies, because a large company already has its databases, and with the mobility of the insured it can even create its own. And so the preferred target for fraudsters is likely to be the small company, which does not have the data and the expertise. Therefore, sharing data on a large scale leads to bridging information asymmetries and making it less of a burden for small companies to do business in a certain line of business. We have used incredible disclosure in the data, for example by publishing the components of third party motor liability, of litigation between the various territorial areas, and we have seen that in recent years there has been an increase in supply in the Campania area. So this means that, knowing the market, perhaps the smaller company was a little more hesitant because it did not know the market,  the phenomenon,  the situation, and we have tried to eliminate these barriers to entry and the market, to make the market absolutely more competitive. However, as we were saying, we try to provide information, but organised information must be provided, and then it must also be provided by monitoring its proper or improper use, and every time I am sorry because Mr Guidoni tends every time to point out a not very hidden criticism on recruitment fraud. Every time I tell myself that, although I might be boring, I hope that in this coming and going from Damascus it might be the right time for conversion. Organised information, what does it mean: says the IVASS is against it. IVASS is in favour, the law says so. Meanwhile the law says in which cases, that is, it declines it and says that you must verify the truthfulness. I would like to know which other one is the anti-fraud assumption? If you want to set a price on the basis of the history of claims, it is illegitimate; I cannot set a price in an elusive manner, even if you have criminal convictions, so I will make you a million euro because you have defrauded in the past. Apart from the fact that all our systems are predictive, so it’s not certain, it’s probable, that you could be a fraudster, but in the settlement phase. So at that stage, you will have all the indicators. If you have a claim we will give you all the indicators, but what is the point of having the indicators of the liquidation phase in the underwriting phase? In the recruitment phase he has to go and check something else, and we make that other information available in full. If I also want to know whether he has had an accident at a stop where there is no responsibility, driving style, etc., it is redundant information, it is of no use. So the request “give me all the information you can, so that we can do antifraud recruitment” is a wrong request, just as so many other times, on right causes that have been identified by the association, wrong solutions have been proposed. But I am thinking about the prescription. In the 2017 law, the competition law then approved, there is a reduction. A transformation of the prescription into a forfeiture is a reduction to two years, we all agree that it is a long time, it should be reduced. Very well, that is a real problem. The proposal, I remember it very well, was the transformation of the prescription into a forfeiture and the jurists know what that entails, so once the prescription is up, you can also renounce, the forfeiture is now gone and therefore in specific cases. And then the reduction from two years, I seem to remember, was taken to three months, it’s something like that. As well as, someone said, disconnecting the anti-fraud activity from the specific anti-fraud activity from the times of the liquidation phase; the legislator did not grant this either. But why not? Because it is used in an instrumental manner, and in a delaying manner at times. Here I come to Judge Graziano when he said what rhetoric means. Because you must know that it is not so many years, but at least 8 or 9 years, that I have been dealing with this matter intensively and the various consensuses, the meetings with insurance companies, trade associations, whose meritorious activity it must unfortunately be said sometimes are remembered for the improper and imprecise things they say or do and instead the good ones, the useful ones are so many. For example, in this case, the trade association financed part of the AIA Project, it was an integral part of the working group in the AIA Project, it provided us with so much experience. The problem was that often one goes back home and I go back to supervising while the companies go back to supervising. So, after we’ve talked 100,000 times about the importance of information, many times I’ve run my network analysis on confirmed claims and it turns out they were very clean. Do you know why? Because the figures were not included in the claims database. So if you don’t include the lawyer who acted for you, and the lawyer is at the centre of the network, or the bodybuilder – and why isn’t he included? Well, because of the antifraud claims database, we put the essential information, then we risk being sanctioned if we make a mistake – and we go and see, how crowded are the trustees? How crowded is the witnesses’ entry? It is hardly crowded. So it’s not one of those pieces of information where one checks. There must necessarily be the other party, the injured party, you can’t say there’s no witness, because the witness may be missing and only by sending the inspection you will see whether there was a witness or not. And then you see that when they go home, someone says “well, let’s do it as we did in the past years, let’s make the supervisory authority happy, maybe we’ll file a lot of complaints, lawsuits so the indicator of our anti-fraud activity grows”. This is why, at a certain point, after pushing the idea of “you have to sue”, we backed off a little, after having been called upon also by the Public Prosecutor’s Office for these complaints, which are presented, even in a rather approximate manner and without great contributions, and which can only be filed. I wanted to say one last thing about Dr Mattiuz and I have finished. He said something about the social culture, etc. It is absolutely to be endorsed, but the companies must cooperate. Because when there is obviously a dilatory attitude, how many times has it happened to us that the fraudster has all the papers in order presents everything in order knowing the rules, while, generally, those who are in good faith tend to present incomplete material. A dilatory, uncooperative attitude on the part of the company leads to the spread of the culture of “but once I get a chance I’ll try to get the money which otherwise I’ll never get”, because it is seen as someone to be defrauded. So it is also important for companies to cooperate in spreading the culture of lines. Thank you

 

ANDREA STRATA: Thank you. Of course due to the liveliness of the topic and the debate I see that he raised his hand, but I would have given the floor anyway to the Co-General Manager of ANIA, Dr Guidoni. Please.

 

UMBERTO GUIDONI: We are always happy to receive a good slap on the wrist from Mr De Pascalis and IVASS, because the supervisory body obviously takes the things we say into due consideration, which certainly gratifies us. We, as ANIA, have been on the road to Damascus for some time. The subject of anti-fraud recruitment is not one that can be dismissed in the manner in which Mr De Pascalis so easily did. Point number one: everything that is permitted is not always possible, because what is permitted is only the verification of master data. We remember well that when this article was approved we provided that anyone who makes a false declaration and is therefore obviously not exactly a saint about his own geographical location should have the insurance contract terminated. I don’t remember the supervisory body fighting much when it was decided that the contractual premium should be changed. So I know that in the meantime I’m putting someone in my house who makes false declarations, but I’m raising his premium because this is provided for by the law and therefore in this way I have compensated for the fact that there a person made a false declarationHaving said this, the anti-fraud recruitment is far from being a tool through which blacklists are made and the circumvention of the obligation to contract, also because I believe that the Supervisory Authority has all the tools to be able to highlight and prevent the circumvention of the obligation to contract, on which the companies pay plenty of penalties in the event that they should put in place such attitudes. If you have not yet equipped yourself with tools to prevent this from happening, the trade association is happy to fund any possibilities to improve your supervisory activities. This cannot be. The issue of pricing through which we exclude people from compulsory insurance cover – then we are talking about compulsory insurance cover here, then we have the whole issue of non-motor, which is not compulsory – we exclude people from the possibility of cover is not the issue. We have never posed it as an issue and we believe that underwriting anti-fraud is essential from the point of view of fraud prevention. This is because underwriting anti-fraud is certainly essential, but it does not prevent it, it goes to remedy fraud that has already taken place and this is a not insignificant aspect. Therefore, knowing a series of data and developing algorithms that make it possible to verify that a person is at risk of fraud is an element that also allows further investigations and in-depth studies to be carried out in the settlement phase when claims are reported. This is the logical concept, not the concept that different pricing should be determined, because if a person has ten claims because he is unlucky, he will pay the premium linked to what technically concerns his frequency, concerns the claims he has made. Full stop. And this is not the reason why the obligation of the contract should be avoided. A final remark on the subject of forfeiture. It will not escape anyone’s notice that this was a ploy, but I would like to remind Mr De Pascalis that we had envisaged a two-year limitation period and no one helped us to reduce the limitation period, because motor liability insurance is characterised by a special law and already enjoys a five-year limitation period. Therefore, our first proposal was precisely to provide for a two-year statute of limitations.  When we went to the hearing, we, like you, were accused by the President of that Commission of wanting in some way to restrict the freedom of defence of consumers, and he even defined that rule as unconstitutional. Thus, on the basis of this consideration, we decided to find a ploy to try to see if the way to reduce a prescriptive period that seems absurd to us, as you rightly said, Mr. De Pascalis. Because it is absurd, we found this solution, which will certainly not be legally perfect, but it went in the direction of trying to limit a phenomenon that you know better than I do. You see, the doctrinal legal fundamentalism produces a phenomenon: that of one claim out of four at risk of fraud, in which if they did not intervene a little with the dynamic certificate, the issue of the time space to report the claim, is an issue that produces countless frauds, of which one in three in the South. So we have tried to find a solution, and in this sense, I repeat, you are certainly right, as I am not a lawyer, so it may not have been the best solution, but we had found the best solution and they did not let us proceed. I believe that it is true that companies that do not carry out their activities in full must be penalised. It is correct for the Supervisory Authority, and I say this sincerely, to try to improve the work of companies. On the other hand, however, we would like to have the Supervisory Authority on our side to support us in pursuing serious and real cases, and not always be like those who want to try to find alternative solutions. Then, everything can be improved and we are very happy to receive advice to improve what can be improved.

 

ANDREA STRATA: Mr Guidoni, thank you. We are in the final session. Clearly we cannot continue this very interesting debate, given that we have run out of time, but we are really pleased that we have set the basis today, under the pretext of this book, to meet again in other venues, to discuss these issues, which are truly complex. We have struggled to summarise in a few pages a massive theme. I would now like to ask Mr Caliendo to say his final farewells because we have gone a bit too far and we have abused your patience. Thank you.

 

ANGELO CALIENDO: Thank you, thank you Andrea. I would like to thank all the participants, it really was a good panel made up of different experts on the same subject, in the spirit of the Institute’s work. So a vertical plan, where different professionals can meet and discuss the issue, was our goal, which was definitely achieved thanks to the interventions of the participants, your valuable work. And this is just the beginning. Mr De Pascalis said that we have little time, because either we present the book or we have to open a public debate on this issue and ensure that it is brought to the attention of the public, also because of the economic, political and social implications that our councillor, Mr Nicola Graziano, clearly outlined. So, I thank you all and I leave you with a promise: this was only the first stage and the Institute is the right place, in my opinion, where we can develop this type of debate and bring it to the attention of decision-makers so that they can intervene with the necessary legislative changes – as has emerged from this debate – to protect all citizens. I thank you and wish you a good evening.

 

 

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