Welcome to the Pondera FraudCast, a weekly blog where we post information on fraud trends, lessons learned from client engagements, and observations from our investigators in the field. We hope you’ll check back often to stay current with our efforts to combat fraud, waste, and abuse in large government programs.
I read with great interest the story this month about a woman who cheated her way to a second-place finish in the Fort Lauderdale half marathon. After posting a time of 1 hour and 21 minutes, the website www.marathoninvestigation.com revealed several problems with the woman’s results including: the race statistics she posted to a website were manually entered (versus those calculated by her GPS), a second set of results she posted seemed more consistent with a bike ride, and a zoomed photo of her post race wristwatch revealed that she ran only 11.65 miles of the 13.1 mile race. This evidence led to an admission and apology by the runner.
What I find interesting about this incident is how indicative it is of the ever-increasing power of data. While runners collect data to help them train and perform better, it can also be used to uncover cheating and fraud. This is no different in government subsidy programs, like Medicaid and welfare systems. Governments collect data to help them improve service delivery to their constituents, and with modern technologies, the data can also reveal fraudulent anomalies and patterns.
Of course, bad actors who want to defraud programs are aware of the increased use of data to catch them. Gone are the days when they can blatantly abuse government systems knowing that the size and complexity of the programs would make it nearly impossible to catch the cheats. In running, who would dare to repeat Rosie Ruiz’s 1980 Boston Marathon “victory” where she was spotted riding the subway with her runner’s bib?
Instead, bad actors often “fly under the radar” – stealing smaller amounts over longer periods of time to avoid being noticed. Second place in the Fort Lauderdale Marathon is certainly “under the radar” compared to a victory in the Boston Marathon.
So, now that our fraud detection capabilities can catch bad actors who boldly fly above the radar and those who strategically fly below the radar, one would hope that it would lead to decreases in fraud attempts. But I also know that making fraud harder to commit rarely turns fraudsters into honest and contributing members of society. It just makes them work harder. This simple fact provides us with the incentive to continually improve on our technologies and approaches. This is one war we fully intend to win.