Marius Werner – A call to action Building effective

HFMU Presentation
CONTENTS
1. Introduction
2. Road Accident Fund
3. Fraud
4. Forensic Investigation Department
5. MOU with NPA
6. Creation of FITT
7. Working agreement
8. Working methodology
9. Results
10. Conclusion
INTRODUCTION
As a country’s economy grows stronger, the number of motor
vehicles on its roads will increase. This of course leads to an
increase in motor vehicle accidents [mva’s]. This has a direct
impact on the social-economic activity of the country. The
South African Government recognized as early as the 1940’s
that government intervention was necessary to safe guard its
citizens against financial ruin that may follow a mva. This lead
to the creation of the Road Accident Fund [RAF] in 1946. The
RAF is a creature of statute and is currently governed by the
Road Accident Fund Act, Act 56 of 1996, as amended.
ROAD ACCIDENT FUND
Vision: The Vision of the RAF is to provide the highest standard of care
to road accident victims to restore balance in the social system.
Mission:
The Mission of the RAF is to provide appropriate cover
to all road users within the borders of South Africa, to rehabilitate
persons injured, compensate for injuries or death and indemnifying
wrongdoers as a result of motor vehicle accidents in a timely, caring
and sustainable manner, and to support the safe use of our roads.
ROAD ACCIDENT FUND
The RAF forms part of the Department of Transport. It is funded by a
levy on fuel which basically means that each and every road user
contributes to the income of the RAF.
In its most basic format the RAF can be describes as giving assurance to
victims of a mva, be it injured people, people who are disabled and
not in a position to continue to generate an income or dependents
who has suffered loss of support, as well as the wrongdoer who will
not be able to pay damages that would have followed from legal
action.
ROAD ACCIDENT FUND
The RAF is currently operated on a fault-based system where negligence
of at least 1% on the side of the driver who caused the accident must
be proved by the claimant in order to be successful with a claim. This
opens the whole system up to massive litigation, that leads to money
wasted on legal fees, attorneys making fortunes to the detriment of
suffering claimants and huge delays in settling claims. It is for this
reason why it has been decided to form the Road Accident Benefit
Scheme [RABS] that will be completely no-fault. The concept
legislation has recently been opened to the public for comment. Legal
professionals in the third party environment is, as expected, very
strongly opposed to this.
ROAD ACCIDENT FUND
The heads of damages for can be claimed are:
1. General Damages.
2. Past Medical Expenses.
3. Future Medical Expenses.
4. Past and Future Loss of Income.
5. Past and Future Loss of Support.
6. Funeral Expenses.
FRAUD
As everybody gathered here are aware, fraud in the 3rd party
environment is rife and the RAF is no exception. In the last FY
fraudulent claims in excess of R 150 000 000 were identified in 1103
files of 6467 files investigated.
There are also a large variety of ways in which claims related fraud
against the RAF are being committed. The majority of these varieties
will be well known internationally.
FRAUD
1.
Add-On:
The largest number of false claims
to date emanated from accidents that were either complete
falsely created or where there was an accident but only the
two drivers were involved. The accident is reported to the
South African Police Service [SAPS], in the case where the
accident did take place it is normally done for insurance
purposes, and an Accident Report [AR] is completed. And
here the fraud chain start.
FRAUD
A copy of the AR is sold to a tout by a SAPS member with access thereto.
The tout recruits “passengers” for the accident, instruct them on the story
line of how the accident occurred and assist in the drawing up of
affidavits and making copies of their ID documents.
The tout completes the necessary forms and take these to a doctor, who
for a fee, certify that he consulted with the claimant and that in
his/her professional medical opinion were injured as a result of a mva.
This bundle of documents is then sold to an attorney.
FRAUD
2. Evolving:
In 2008 the Act was amended to reflect that a
person can only claim for General Damages if such a claimant
suffered a serious injury. A serious injury is defined as 30% or
more bodily impairment. This took care of the thousands of
fraudulent claims where whiplash to the neck was claimed as the
injury. This was very difficult to disprove and although the payout
for these claims were about R 80 000, we received literally
thousands.
FRAUD
After the Act was amended in August 2008 we saw, within months, a
change in strategy. Foreigners from Swaziland or Mozambique who
passed away in mva’s on South African roads was suddenly found
to all have been married to South African women and they all had
two or three children as well as solid employment in South Africa
as, for example, a stock controller at a reputable supermarket
chain. A claim for Loss of Support for the “wife” and “children”
worth a few million rand then follows. A proper investigation
however will show that the customary marriage certificate is false
as is the employment certificate.
FORENSIC INVESTIGATION DEPARTMENT
The RAF board realized in 2000 that fraud was rife and something had
to be done. After an unsuccessful experiment with an external
forensic firm a decision was taken to create an internal investigation
capacity and the Forensic Investigation Department [FID] was born.
It consists of a Senior Manager at Head Office and then units at each
of our 5 regional offices. The units consist of a manager, three to
five senior investigators, and one or two investigators reporting to
the senior investigator. Currently FID has 90 approved positions.
FORENSIC INVESTIGATION DEPARTMENT
The reporting line is FID staff in a region to the FID manager of that
region. The managers report directly to the SM: FID and not to the
General Manager of their respective regions. The SM then reports
directly to the chairperson of the Risk and Ethics Management
Committee of the Board. This ensures complete independence.
MOU WITH THE
NATIONAL PROSECUTING AUTHORITY
In 2002 it was found that criminal cases reported by FID to the SAPS
were not receiving any attention. Those cases that did get
attention from the SAPS and went to a prosecutor did not get the
necessary attention there. This was mainly because of
inexperience and huge work loads. It became clear that
prosecutors who only attended to RAF cases were needed and
after lengthy discussions a MOU was signed with the National
Prosecuting Authority [NPA]. SAPS also bought into the concept
and agreed to second members from the Commercial Branch.
CREATION OF FITT
The signing of the MOU gave creation to the Fraud Investigative
Task Team [FITT]. This entailed a National Co-ordinator who is
a Deputy-director at the NPA who is in charge of FITT, a National
Investigation Co-ordinator who oversees and manages SAPS
investigations and a National Administration Co-ordinator who is
in charge of the administration of all offices nationally. There
are prosecutors and SAPS members at all of these offices and
their sole task is dealing with fraudulent cases reported to them
by FID.
WORKING AGREEMENT
The number of claims identified as fraudulent and reported to FITT
is very large and the number of seconded SAPS members are
limited. The agreement is that FID will investigate as far as the
law allows them [arrest and Sec 204] before handing the
matter over. In the majority of cases everything is done and the
cases can simply be registered [Case docket covers] and
given to the prosecutor for a decision and an arrest warrant.
When the case is placed down for trial the prosecutor will consult
with the FID investigator who conducted the investigation before
he/she is called to testify.
WORKING METHODOLOGY
As mentioned earlier the people targeted by touts are the poor and
destitute and of late singe mothers. No court will give a direct
prison sentence and therefore no message is sent out and the cycle
continues. In the past four years we have engaged in plea
agreements with claimants where they plea guilty and is given a
suspended sentence. In return they give us an affidavit setting out
who approached them and how, whether they saw a doctor and if
so when and whether they consulted with the attorney who lodged
the claim.
WORKING METHODOLOGY
When we have 80 to 100 claimants from several “accidents” who
all incriminate the tout, doctor, attorney or SAPS member, we
then register a criminal case against these individuals. We
also insist on giving evidence in aggravation of sentence and
ask the courts to impose direct imprisonment sentences in
order to send out a strong warning.
RESULTS
MAR 2014 External Investigations
6102
6467
Month-to-Date
March 2014
6468
447
436
6479
181
62
1103
54
3197
256
478
573
798
22(95)
25(32)
36
113 178 481.60
44 016 588.20
286
10 074 737.00
2 304 760.00
13
FY - YTD
Files Carried Over
Files Received
Files Closed
TOTAL
Link Number of cases awaiting CAS number from SAPS
Link Number where CAS numbers has been allocated by SAPS
Link Number of Files in which fraud had been identified
Link number of Files investigated and returned with no indication
of fraud
No. Arrests - Person Count (Link Number count)
No. Convictions - Person Count (Link Number count)
Repudiations
Repudiations Claimed Amount
Repudiations Estimate Amount
Total Claims no Estimate Amount
CONCLUSION
Reflecting on the position the RAF found itself in, in 2002 and
looking back at the last 11 years since FID and FITT has started
to co-operate, it is clear that this is the optimal way to fight
fraud. The RAF has also over the years entered into several
other MOU’s with both government agencies such as Home
Affairs or, as very recently as last month with the South African
Insurance Crime Bureau [SAICB]. It is very clear that fighting
crime from within silos and a reluctance to share information will
prove to be debilitating to any crime fighting cause.

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