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Fraud Aware March 2019
2018 proved to be a momentous year for Keoghs Partner, James Heath. Firstly, his pioneering work in the fraud arena over the last two decades saw him collect the prestigious Achievement Award at the Insurance Fraud Awards. This was followed shortly after by election as president of FOIL (Forum of Insurance Lawyers).
As one of the founding partners of our Counter-Fraud Services division in 1998, the fraud arena has undergone countless changes. So, whilst James is looking to the future after a successful 2018, we thought we’d ask him to cast an eye back over the changes he’s seen during his time as a counter-fraud lawyer.
If you could identify three areas of insurance fraud that have changed the most since ’98, what would they be?
Over the last 21 years, but if I was to narrow down three items, I would have to say:
- Industry resources - When we first started, cross-industry collaboration was limited to ad-hoc round table exchanges. Seeing the industry investment in centralised counter fraud resources, the initial launch and then continued development of the IFB, IFR, IFI-Hub and IFED, has been an evolution in its own right.
- Intelligence resources & solutions - Keoghs was the first law firm to develop a dedicated intelligence team which now has nearly 50 intelligence experts from a range of backgrounds and skillsets, all helping us deliver fraud outcomes more efficiently. The technology available to our teams has never been more sophisticated.
- The law itself - 20 years ago the courts had rarely experienced allegations of fraud in relation to staged accidents, induced accidents, bogus passengers and suchlike. Judges were initially wary of dealing with such issues. However Keoghs was at the forefront of pushing the legal boundaries to support the delivery of a legal framework that now provides an effective platform for fighting fraud.
Many of these were firsts but, as with any evolution, are now seen as the norm. Our ongoing challenge, therefore, is to ensure that we continue to develop and implement innovative remedies and solutions to support clients in delivering optimum fraud outcomes.
Have the changes to the Civil Procedure Rules and the introduction of new legislation during your time in counter-fraud services made it easier or more challenging to fight fraud?
I’m long enough in the tooth to remember the publication of Lord Woolf’s 1996 report on Access to Justice, which in turn led to the Civil Procedure Act (1997) that laid the foundations for the introduction of the CPR in April 1999.
The changes to legislation, CPR and case law over many years has made the legal landscape for fighting fraud far more transparent and effective, with FD regimes a part of this. Through testing the boundaries over previous years, we now see a broad range of tools available to our lawyers – be that tort of deceit, exemplary damages and more recently pursuing contempt proceedings and pursuing private prosecutions.
How have the incredible advancements in technology over your time as a fraud expert impacted on counter-fraud investigations and strategies?
The development and evolution of intelligence resources available to Intel teams over the past 20 years has been near exponential, with the IFB, IFR and now Intelli-Hub showing the power of the industry collective. I have no doubt that investment in collaborative industry resources will continue to pay dividends.
The advancement of Keoghs resources over the past 20 years has also been dramatic, culminating in our current work on the next generation of intelligence solution along with Artificial Intelligence.
In addition the range of intelligence systems available to clients is ever-sophisticated and diverse. It is therefore incumbent on us to remain agnostic in the development of our own solutions, ensuring that we can integrate and engage with our clients.
Is the industry in a better position to combat fraud now than it was 20 years ago?
There is absolutely no doubt that the industry is in a better position to combat fraud now than it was 20 years ago – and frankly, if it wasn’t, then we would have failed! What we cannot do, though, is rest on our laurels. As the IFB Industry Threat Assessment has identified, fraud risks are evolving and new threats are emerging. It is therefore important that we not only keep pace with the evolution of those risks, but get ahead of them – ensuring we proactively identify new risks and close those stable doors before the horses bolt!
And finally, what do you think will be your biggest challenge as FOIL President?
The greatest challenge during my year as FOIL President will be to remove my fraud blinkers and take a wider, more holistic view of the issues affecting our clients!
It is just over two months since I took over the role of President, but I have already immersed myself in issues such as the Discount Rate review, the MOJ review of LASPO (recently meeting with senior MOJ officials to discuss a defendant’s perspective), the Law Commission consultation on Autonomous Vehicles, plus the small matters of Brexit and whiplash reform.
The latter is particularly interesting. Being part of the cross-industry stakeholder group led by the MOJ/MIB, in conjunction with ABI, FOIL, APIL, MASS, Medco and other key stakeholders, gives real insight and an opportunity to help shape the landscape that we and our clients will operate in after April 2020. Coming back to my roots, there is also the need to ensure that obvious fraud risks raised by the reforms are successfully mitigated and managed.
I think outgoing FOIL President, Steve Hines, summed it up perfectly when saying to me, “Don’t mess it up”.
I’ll try my best not to!