Listen up! Fraud may be telling you a story
Waggoner, Senior Special Agent, NICB, shares important listening techniques with Exchange attendees.
That’s because during Waggoner’s long, storied and still active career tripping up and catching wrongdoers, his acute and insightful ability to listen to verbal cues and hints pointing to misdeeds have proven to be his most effective weapon. He began his career as an officer on the St. Louis Police Department in 1968. During one sting operation, in which Waggoner acted as a crook selling government checks and other property to local fences, the department bagged 27 miscreants when their target list contained only seven.
During his time with the SPD, Waggoner gained a reputation as one of the ablest and most consistently effective interrogators on the force, securing confession after confession. His secret? Learn how to listen.
Waggoner retired from the force in 1993, but shortly thereafter went to work for the NICB’s St. Louis office, where his skills as an investigator have been put to good use ever since.
The insurance industry’s campaign against fraud is as important to the honest insurance consumer as anything we do to deliver a fair quote or effectively handle a claim. As crime statistics, including the NICB’s have shown, insurance fraud adds between $30 to $60 billion dollars a year to the tab being paid by honest Americans every time they mail in a premium check.
Since the merger of the Insurance Crime Prevention Institute (ICPI) and the National Auto Theft Bureau (NATB) created the NICB in 1992, it has been in the forefront of industry efforts to combat insurance crimes such as fraud. Today, the group is the premier industry initiative taking on insurance criminals and trying to reduce the costs of fraud to companies and the consumer. More than 1,000 insurance companies, from the largest to the smallest, support the work of the not-for-profit NICB. The Special Investigative Units of those companies refer more than 70,000 cases to the NICB annually, including 7,000 calls to a special hot line.
From crimes of opportunity to true professionals
Needless to say, the investigative and interrogation skills Waggoner learned as a police officer have been particularly useful in his second career as an insurance fraud investigator.
“There are three distinct levels of insurance crime,” Waggoner said. “On one level, you have an essentially honest claimant who has been paying premiums for many years and gives in to the temptation to get a deductible back with a little help from the body shop. Probably never did anything like that before and not likely to do anything else dishonest again. It’s still fraud.
“Then you have less honest people who may have a genuine claim like a burglary, but decide to take advantage of the claim by remembering a laptop or a large screen TV that was taken during the theft,” he said. “There was a burglary, but the TV or laptop never existed, except on the claim report.”
Finally, as Waggoner put it, you have the professionals who get up every morning with the full intent of defrauding an insurance company, like the head of a gypsy crime family who, upon giving himself up voluntarily, reported that he had earned $12 million in 15 years simply by staging slips and falls while traveling to and from favorite vacation spots such as Las Vegas.
“What many of these situations have in common is the belief on the part of the person doing the fraud that they’re not really hurting anyone because these huge companies can afford it,” Waggoner said.
Except that the combined toll of insurance crimes of all types annually adds from $30-60 billion from the system and imposes extra costs of $200 to $300 on every American family. And that’s just on the property and casualty side of the business.
Get ‘fraudsmart’
One of the most effective tools Waggoner has ever used during an investigation or interrogation is the simple power of listening, and listening in every sense of the word. Being alert to verbal cues and shifting details indicative of a person likely to be under stress. And giving the suspect the comfort level and the right opening to come clean when he or she simply feels the time is right.
“You have to remember that many of these people are continuously afraid of being caught from the moment they commit the fraud,” Waggoner said. “It’s on their conscience and it’s on their minds every moment. For some, it’s just a relief to get it out.”
Waggoner’s interrogation strategy is a far cry from the tough guy routines so often depicted in television crime dramas. His style is to put persons being questioned at ease, ask them how they’re doing, offer them a cup of water or coffee. Of course, the fact that he strategically positions himself between the subject and the door to the interrogation room or office is just one non-verbal cue as to who is in charge.
“The sad truth is that a lot of these people are basically honest,” Waggoner offered, not sounding like the tough street cop who patrolled the St. Louis byways across four decades. “A lot of times these are just people who got into tough situations, like getting behind on their car payments, and felt like taking the easy way out was the only way. So, suddenly the car ends up at the bottom of a quarry and the next day is reported stolen.”
Waggoner offered some other time-tested recommendations to claims people, SIU investigators and others aligned with the NICB in fighting insurance crime. In addition to listening – really listening – to what the other person is saying, stay focused on body language and mannerisms, avoid distractions and above all document your notes and impressions during or immediately after the interview, because memory is notoriously fleeting.
“I was once involved in a raid on a doctor’s office in Chicago in partnership with the FBI,” Waggoner said. “I and an FBI agent interviewed the suspect for two hours, after which I immediately sat down and typed seven pages of notes. When I next met with the FBI agent six weeks later, he had two pages of notes that he had written up a couple of weeks after the interview. In looking at my notes he was amazed at all the details he’d forgotten. We used my notes for the final report.”
Tips for better listening
Bottom line, Waggoner offered several tips to improve effective listening that work as well in an office as they do in a police interrogation room or on the mean streets of a major city.
- Listen now, report later – Focus on what the person is saying and how he or she is saying it, not on how fast you can scribble.
- If you are using a recorder, forget it – The tool is a great aid, when it works, but don’t bet your whole interview on it.
- Learn to want to listen – If you don’t really want to be there or don’t really care, it will come across and you won’t be effective.
- Be present – Act interested and be in that room or on the telephone line, not sitting back with your feet up reading from a script.
- Control your emotional buttons – Don’t go off on the subject, accuse or openly intimidate.
- Control distractions – Tell colleagues what you are doing ahead of time.
- Listen to the other person to understand, not to refute.
- Avoid multi-part questions that can get the subject, and you, confused and off track or that allows the subject to get away with answering only a part of the question.
- At the same time, try not to ask questions that can be answered with a simple “yes” or “no.”
- Recognize the red flags represented by people who freely offer information for which you haven’t asked.
“Most of all have confidence in yourself and aim to try to make every interview you do the most excellent interview you’ve ever done,” Waggoner said. “It may pay off in court down the road.”
And considering the stakes in the insurance fraud game, that’s one police order we should all be happy to obey.
Click here to view Waggoners’s presentation.
Contact Info:
Walter Waggoner
Senior Special Agent
National Insurance Crime Bureau (NICB)
636.861.3715
wwattoner@nicb.org
www.nicb.org
