Skip to main content

Advertisement

Advertisement

19 involved in major motor insurance fraud hauled to court

SINGAPORE — In what could be the biggest web of deceit involving motor insurance fraud uncovered so far, 19 people were charged yesterday for cheating insurance companies through bogus motor accidents that happened in 2008 and 2009.

SINGAPORE — In what could be the biggest web of deceit involving motor insurance fraud uncovered so far, 19 people were charged yesterday for cheating insurance companies through bogus motor accidents that happened in 2008 and 2009.

The alleged offences by these suspects — cheating insurance companies of hundreds of thousands of dollars — would have contributed to the higher motor insurance premiums that motorists had to pay during the two-year period, with insurers then citing the prevalence of fraudulent and inflated claims as reasons for the spike.

Of the group, Su Chia Ern, 44, faces the highest number of charges. He is accused of 28 counts of conspiring with various individuals — including the others charged yesterday — to cheat insurance firms, involving a total sum of over S$269,000 processed or paid out by insurers for property damage and bodily injury claims, as well as to a firm called Concept Services Enterprise. The others accused, who include two women, face one to 16 charges each. Another accused person who allegedly conspired with Su was charged last week.

The main modus operandi, court documents show, involves staging accidents with the accused persons reporting themselves as the drivers or passengers. For instance, Su; Teo Kok Hwee; Pepin Pan Weida, 31; Chan Chee Wei, 32; and Kong Han Keong, 41, allegedly conspired in a purported accident on Jan 21, 2009, at the Sengkang exit of Tampines Expressway.

Chan and Kong reported themselves to be drivers of the two cars involved. NTUC Income paid S$7,210 to Chan for a third-party property damage claim, and another S$39,663.37 to him for a third-party bodily injury claim. The insurer paid S$3,588 to Concept Services Enterprise for an own-property damage claim.

The nature of Concept Services Enterprise’s business was not stated in court, but the Accounting and Corporate Regulatory Authority’s records show that its business activities include the repair and maintenance of motor vehicles. One of the firm’s two listed owners, Lim Chiew Beng, 37, was one of those charged yesterday.

More than a dozen people have already been hauled to court for insurance fraud this year. Those who have been dealt with were jailed between six and 18 weeks.

Several of the accused persons yesterday indicated to District Judge May Mesenas that they intend to plead guilty, and their cases are scheduled for mention again on Dec 19. Pre-trial conferences of several other accused have been scheduled on Jan 15.

The motor insurance industry suffered five years of losses between 2006 and 2010, caused mainly by fraudulent and inflated claims, but has been in the black since 2011.

The General Insurance Association of Singapore (GIA) estimates that inflated and fraudulent claims, which make up about one-fifth of all claims, amount to more than S$140 million a year — costs ultimately borne by motorists and other transport users, said its executive director, Mr Derek Teo.

Mr Teo said premiums have stabilised in the last two years as a result of efforts to combat inflated and fraudulent claims. Nevertheless, the GIA submitted a paper to the Monetary Authority of Singapore in February calling for a new law against insurance fraud. Based on media reports, the average motor insurance premium last year was S$1,250, after peaking at S$1,280 in 2012. In 2006, the average motor premium was S$867.

One of the measures to tackle the menace was the implementation of a Motor Claims Framework in 2008, requiring motorists involved in accidents to make reports within 24 hours or face the risk of being denied claims.

The GIA also formed a fraud committee three years ago to tackle motor insurance fraud in a structured and coordinated manner, said Mr Teo, who did not elaborate on the measures taken. It also encouraged insurers to set up special units to track, monitor and investigate fraudulent cases, and established a fraud hotline (1800 443 7283).

The insurers named in court documents yesterday were NTUC Income, Tenet Insurance and Liberty Insurance.

The maximum penalty for cheating under section 420 of the Penal Code is 10 years’ jail and a fine. Abettors of acts of cheating face the same maximum punishment.

Read more of the latest in

Advertisement

Advertisement

Stay in the know. Anytime. Anywhere.

Subscribe to get daily news updates, insights and must reads delivered straight to your inbox.

By clicking subscribe, I agree for my personal data to be used to send me TODAY newsletters, promotional offers and for research and analysis.