Better technology, best practices will stop scams, catch criminals

LANSING, Mich. – Secretary of State Ruth Johnson today announced a new plan to thwart scammers trying to take advantage of law-abiding citizens by selling fake insurance or through other tricks. The move is part of her ongoing efforts to protect consumers and fight auto insurance fraud.

The new efforts use cutting-edge technology, expand best practices and maximize resources. They include:
• A comprehensive review of her department’s processes, technology and structure to determine how best to detect and deter fraud.
• Data analysis to identify signs in transactions that may indicate fraud.
• Expanding the verification of the thousands of insurance certificates the department receives from customers daily.
• An upgrade in case management software to give department investigators the best tools for tracking down fraudulent activity.
• A roundtable discussion with business leaders about fraud to seek their advice and ensure the department is following best practices.

“These new measures will strengthen consumer protection and root out fraud,” Johnson said. “Using cutting-edge technology and through our continued use of best practices, we’ll dig deeper into the millions of transactions we process each year to catch criminals running their scams and stop them from taking advantage of law-abiding citizens.”

The Secretary of State’s Office has contracted with a business consulting firm to complete a full review of the department’s business processes, technology and organizational structure as it relates to fraud. The effort will include review of the systems associated with the management and disposition of fraud cases handled within the department. The project’s goal is to maximize resources to supplement existing investigative principles, to handle issues that are discovered and to add additional steps to deter fraud.

In another initiative, Johnson’s office is looking to use data analysis to compare elements of transactions with those of previous fraudulent ones. Similarities can be used as an alert that a fraud investigation may be needed.

The department has received funding to add staff to a new unit that will verify the validity of the 10,000 to 20,000 insurance certificates that come in through the mail each day from customers renewing their vehicle registration in addition to the reviews already being done in Secretary of State offices. Johnson’s team is also planning to upgrade its case management software so department investigators are best equipped for tracking down fraud.

Plans also call for a roundtable discussion about fraud with a group of leaders from her Business Roundtable that Johnson convened earlier in her term. The discussion would include lessons learned and best practices to keep the department at the forefront of protecting consumers from fraudulent activity.

“We highly value the insights of Michigan’s business leaders, who have solutions from the private sector that can help us in state government,” Johnson said. “We are united in purpose to stop the scam artists who cost the rest of us money.”

Some of the new initiatives are the result of recent recommendations by the Fighting Auto Insurance Rip-Offs (FAIR) Task Force. Others reflect Johnson’s intent to crack down on any type of fraud that targets the department and its customers.

For media questions, please call
Gisgie Dávila Gendreau at 517-373-2520.

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