Fraud Risk Scheme:
An agent, broker, or employee diverts insurance premiums or claims by channeling funds through third-party bank accounts (friends, relatives, or shell companies) to conceal the true destination of the money. The client or contract appears legitimate, but the ultimate beneficiary receives an indirect financial advantage, often to evade internal or tax controls.
Detection:
Transactions synchronized with internal events: transfers or deposits occurring at the same time as closings, premium payments, accounting adjustments, or other sensitive operations.
Split or recurring amounts sent to the same third parties shortly after key financial events.
Temporal correlation analysis between financial movements and internal events to identify suspicious patterns.
Reconciliation of final beneficiaries with official accounts to detect indirect or unauthorized fund flows.
Prevention:
Prohibition of transactions involving relatives or unauthorized accounts: all payments must be made only to official client or company accounts.
Mandatory validation: any exceptional transfer to a third party must go through documented hierarchical approval.
Automated alerts: detection systems flagging transactions involving related or unusual external accounts.
Awareness and sanctions: staff training on risks and strict disciplinary measures for non-compliance.
Share your feedback:
What tools, techniques, and processes are used in your organization to detect and prevent such fraud schemes?
