FSS and Incheon Jungbu Police Cooperate
Fake Patients Recruited via SNS, Medical Certificates Forged
Beware of New Types of Insurance Fraud on SNS
Accomplices Also Face Up to 10 Years in Prison
On August 12, the Financial Supervisory Service (FSS) announced that, in cooperation with the Incheon Jungbu Police Station, it had apprehended insurance fraudsters who recruited 31 fake patients by posting forged medical certificates from a hospital on social networking services (SNS) and defrauded insurance companies of 1.13 billion won.
Fake medical certificates created by insurance fraudsters at Incheon A Hospital. Financial Supervisory Service
The FSS explained that, after receiving a report in April regarding insurance fraud involving forged medical certificates from Incheon A Hospital, it detected the criminal activity and provided investigative reference materials to the police. An incident report refers to a situation where an insurance company reports suspected insurance fraud to the FSS.
A broker in his 30s, identified as Mr. A, led the fraud by recruiting fake patients through SNS loan posts. He lured the general public by posting bait messages such as "loan" and "urgent need for money" in online loan forums unrelated to insurance.
Mr. B covertly proposed insurance fraud during online consultations. He analyzed the insurance coverage details for co-conspirators and provided them with forged medical certificates from A Hospital. He even kindly explained the approximate insurance payout they could receive using the forged certificates. There was also a clear profit-sharing arrangement, with Mr. B taking a 30% cut. He provided detailed guidance on the specific fake diagnoses to use.
Mr. B learned the insurance fraud method involving forged medical certificates from insurance planner Mr. C. He later led the fraud independently. Mr. C also had a history of defrauding insurance companies using forged medical certificates, either under his own family's name or in collusion with multiple acquaintances.
The 31 fake patients submitted forged medical certificates and other documents provided by brokers they connected with through online forums to insurance companies, fraudulently claiming a total of 1.13 billion won in diagnosis insurance benefits and other payouts. Most of the patients lived outside Incheon, where A Hospital is located. After receiving files of forged medical certificates via SNS, they printed them out, stamped them with fake seals instead of a doctor's signature, and then filed insurance claims.
One such fake patient, Mr. D (35), was a resident of Damyang, Jeollanam-do. It takes three and a half hours by car from Damyang County to Incheon. In October last year, Mr. D received a fraud proposal from a broker on SNS, then obtained and printed a forged medical certificate and hospitalization/discharge confirmation with the fake diagnosis "non-traumatic intracranial hemorrhage," and stamped it with a counterfeit seal. He fraudulently claimed 190 million won from three insurance policies he held.
The Incheon Jungbu Police Station apprehended broker Mr. B, planner Mr. C, and the fake patients who led and participated in the fraud.
The FSS urged the public to exercise particular caution to avoid becoming involved in insurance fraud, noting that new types of insurance fraud using SNS posts are rapidly increasing.
The FSS also announced that it had issued a consumer alert to prevent young adults in their 20s and 30s, who are just starting their careers, from becoming involved in new types of insurance fraud schemes using SNS posts.
An FSS official stated, "If, during a consultation via SNS posts advertising 'loans' or 'high-paying part-time jobs,' someone suggests making money through insurance, you should immediately stop the consultation, as this is insurance fraud. Both the masterminds and accomplices in insurance fraud are subject to criminal prosecution, so you must be especially careful not to become involved in such schemes."
Under the Special Act on Prevention of Insurance Fraud, both the orchestrators and accomplices in insurance fraud can be sentenced to up to 10 years in prison or fined up to 50 million won.
The FSS official emphasized, "Insurance fraud undermines the foundation of the insurance system, which is supposed to function as a social safety net by reasonably distributing risk. It is a representative financial crime that harms people's livelihoods by causing premium increases for the majority of honest policyholders. The FSS and the police will continue to actively cooperate to eradicate insurance fraud."
If you suspect a case of insurance fraud, you can report it by phone, through the FSS website, by mail to the FSS headquarters in Yeouido, Seoul, or through the 'Insurance Fraud Reporting Center' on each insurance company's website.
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