After the quakes the insurance frauds emerge
MARTIN VAN BEYNEN
The earthquakes came just in time for Stuart Bell and the failing software business he was desperately trying to keep afloat.
He had forged contracts, including one with the NZ Defence Force, and faked emails to bilk his investors out of over a million dollars.
Then came the Canterbury quakes in 2010 and 2011 and Bell could genuinely claim his company, Black Box Spatial, couldn't go ahead with its fictitious contracts.
Fortunately Black Box had business interruption insurance and successfully claimed about $800,000 from Vero Insurance.
Eventually Vero asked to see the contracts and Bell's world began to fall apart.
This week Christchurch District Court judge Alistair Garland jailed him for two years and three months after Bell pleaded guilty to forgery and deception charges.
While Bell's case is untypical in its size, it is fairly typical of the dishonesty quake-related offending that has come to light in Christchurch so far.
People have always told lies on their insurance claims. There is no need to count the ways.
Thousands of insurance claims followed the Canterbury earthquakes and many people will have succumbed to the temptation to create losses or inflate their value. These dodgy claims are starting to come through the courts and are keeping private investigators busy.
Last week Poulomi Chaterjee, 35, came to the Christchurch District Court to admit four charges of using documents to make earthquake damage claims totalling $48,620.
He put in a series of claims from December 2010 to March 2012 for household items such as a keyboard, broken china, and damaged musical instruments.
When EQC asked for photographs of the items, it found the photographs sent had been taken from the internet.
And this week a 42-year-old Christchurch property developer pleaded guilty to two "wrap-up" charges, putting an end to a District Court jury trial.
The woman, whose name is suppressed, had pleaded not guilty to eight charges of forgery and other dishonesty. The Crown said the charges related to work done on properties the woman owned in Christchurch.
She allegedly put in one invoice in the name of a firm that did not exist and claimed for work not done. Increasingly complex fraud cases are emerging and more bogus claims will land in court, the Earthquake Commission (EQC) says.
EQC Canterbury home repair programme manager Reid Stiven says 130 claims involving 23 people have been referred to the police since the September 2010 earthquake.
"We have a number more in the pipeline, " he says.
"We are also investigating other types of fraud, some of which are quite complex, and we expect to refer more files to the police for prosecution in the near future."
Sophisticated frauds have however yet to hit the courts. These are frauds where people, generally working in the system, use their position to systematically filch money.
The Serious Fraud Office has one major earthquake fraud inquiry underway but is not giving much away.
It has investigated a number of earthquake fraud allegations "but to date these have been closed due to lack of evidence of offending".
One investigation remained open, it said. This is believed to involve an alleged collusion between a loss adjustor and contractors in a scheme to defraud Lumley Insurance.
In frauds yet to come before the courts, EQC might be thinking about an Irish Fletcher EQR quantity surveyor who left the country immediately after he was questioned about alleged collusion with a contractor in overpricing and invoicing for work not in fact done.
It looks therefore the small fry are being picked off. As for the serious frauds, watch this space.
- © Fairfax NZ News