Surveillance of social media is one of the fastest- growing areas in the fight against workcover insurance scams, with such websites (particularly Facebook) becoming an investigator’s “new best friend”. According to a NSW District Court Judge social media evidence is not only cheaply obtained, but is more compelling. Also Facebook pages may be admissible as evidence in Australian courts under certain circumstances.
Workcover Private investigator – social media ‘friends’ with benefits
Social media: ‘friends’ with benefits for fraud investigators
22 September 2014 | Insurancenews.com.au
Advances in social media are presenting new and challenging risks for insurers – plus some interesting opportunities that should not be underestimated.
The legal complexities presented by Facebook, Twitter and similar websites were the focus of a presentation by NSW District Court judge Judith Gibson earlier this month.
“Social media, as a source of information, contains just as much good news as bad news, for insurers and lawyers alike,” she told the Australian Professional Indemnity Group conference in Sydney.
It is already proving useful in (workcover) claims, with user profiles being tracked to expose dishonesty.
For example, workers’ compensation investigators may find a supposedly injured employee posting photos of their latest hang-gliding trip on Facebook.
Insurance fraud in Australia costs more than $2 billion a year, according to the Insurance Fraud Bureau of Australia, an independent taskforce of the Insurance Council of Australia.
Federal government agency Comcare has used Facebook and Google to expose fraudulent workers’ compensation claims.
In a circular last year it encouraged government officials to keep an eye out for “injured” colleagues posting pictures of their sporting triumphs.
More than 150 fraud allegations were made against workers or healthcare providers in the Comcare scheme in 2012/13.
Justice Gibson says the benefits of social media can be seen in the legal defence of personal injury claims. The technology is useful in cases where a claimant alleges ongoing disabilities, because insurers find this difficult to challenge without surveillance evidence.
She says traditional surveillance evidence is costly to obtain, ambiguous and frequently explained away by plaintiffs (injured workers) as representing them “on a good day”.
“However, social media evidence is not only cheaply obtained, but is more compelling.”
Earlier this year an Australian saxophonist claimed neck and back problems, but Facebook pages were presented that showed her skiing, travelling overseas and teaching students. She failed in her insurance claim and was awarded only a small sum for out-of-pocket expenses, Justice Gibson says.
However, there are potential pitfalls in using social media to expose scams.
In the US, where insurance fraud is estimated to cost $30-$60 billion a year, legal analysts say there is nothing unethical or illegal in lawyers or investigators accessing a social networking profile that is open to the public.
But the courts are likely to rule it is a violation of professional ethics for lawyers to “friend” a suspect to gather private information.
The US Association of Certified Fraud Examiners says mining social media is one of the fastest- growing areas in the fight against insurance scams, with such websites becoming an investigator’s “new best friend”.
Scott Catron, Senior VP of the US-based Titan Investigative Alliance, says it is important to confirm the correct user is being investigated, because claimants (injured workers) can get creative.
He has encountered people with two Facebook profiles – one apparently confirming an injury’s existence and one suggesting otherwise.
Justice Gibson says Facebook pages may be admissible as evidence in Australian courts under certain circumstances. But usually they must be disclosed early, and sometimes notice must be given that such evidence will be used.
Justice Gibson says it should be remembered that social media is just another form of publication, albeit in a more permanent and global form – which can be to investigators’ advantage.
In the US the stakes are high: insurance fraud is the second most expensive white-collar crime after tax evasion.
Australian insurers will no doubt watch developments there with interest.