Drones: Flying the Fraudly Skies

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Crime Trends: Droning Out the Noise

Drones are hovering all around us. Well, maybe not right this minute, but very shortly if we’re to believe the current news stories about the incredible growth forecasts for the unmanned aerial vehicle (UAV) industry.

Initial business forecasts vary but the Association for Unmanned Vehicle Systems International “estimates the initial three-year economic impact of drone integration in the national airspace system will be $13.6 billion…with a projected economic impact of $82 billion by 2025.”

BI Intelligence adds, “the global commercial drone market will take shape around applications in a handful of industries: agriculture, energy, utilities, mining, construction, real estate, news media, and film production.”

There’s no shortage in commercial drone demand. In August, 2015, a Fortune magazine story stated that the “FAA had approved more than 1000 applications from companies seeking to operate commercial drones and is currently approving applications at a rate of roughly 50 per week.”

Regulation

The sheer number of entrants, in this booming field, is already posing challenges for federal and state regulators. The FAA’s trying to “catch up” with the current demand, technological development and intended business usage.

Like most instances, technology and innovation quickly outpaces legislation and regulation. The fledgling commercial UAV industry is certainly no different. However, the “regulation can’t keep up with technology” issue isn’t a “newsflash.” Computer crime is the poster child for this analogy.

Drones: The Good, the Bad and the Ugly

There will be good and bad sides to the rapid ascension of both recreational and commercial drone flights across the globe as technology tools are a “double edged sword.” For every legitimate application that a technology tool’s created for there is an equal and opposite illegitimate usage as well in the wrong hands.

The Good: According to the USA Today, retailers like Wal-Mart and Amazon have reportedly requested regulatory permission from the Federal Aviation Administration (FAA) to test drones as customer delivery vehicles (cars, parking lots, people’s homes).

The Bad: There will undoubtedly be unforeseen problems (the bad) with these applications once drones are deployed. These include overly crowded, drone filled skies, illegalities and privacy issues. Several instances of drone lawlessness have already surfaced.

The Ugly: Nefarious types, like smugglers recognize the potential to take legitimate tools and use them for an unintended purpose. They’ve already started using drones as drug drop delivery systems in avoidance of prison rules and state and federal law enforcement agents responsible for drug enforcement.

Improved Investigative Technique

Insurance companies could see major business benefits, efficiencies and cost reduction from drone technology. Drones could prove useful for adjusters documenting insurance claims involving major weather related disasters (houses, properties, businesses, cars, boats, etc.) and agricultural crop damage claims where it’s necessary to efficiently assess the condition of the farmer’s field.

Drones will also significantly impact the methods used to investigate suspicious insurance claims. Insurance vendors, like private investigative companies, are always looking for new and improved techniques to conduct traditional insurance fraud investigations. Drones are quickly changing the surveillance landscape.

Enterprising investigators have already flocked to camera carrying drone technology to get the evidence needed to prove a claimant is either committing fraud outright or significantly exaggerating their Activities of Daily Living (limitations, restrictions, etc.) or inability to work.

The use of a drone in an insurance claim investigation might be the difference between getting no useful video footage or securing the evidence needed to get an insurance fraud conviction.

The Last Word

Drones, in and of themselves, aren’t a problem. Like anything else, it’s how people choose to use or modify legitimate applications for illegitimate purposes that becomes an issue for law enforcement.

So, the question is, what will the fraud ramifications be for the new drone industry? No one knows for certain but with all new technology applications there’s usually someone seeking to exploit it for purposes it was never intended for. Drones won’t be immune to this.

Invariably, some “bad actors,” and enterprising organized crime groups, will find a useful purpose for drones in their efforts to defraud unsuspecting citizen’s. What that is at this point is anyone’s guess. However, if history’s any indicator, two things are certain: it will happen and it won’t be that long before it does.

Drone Fraud: Coming soon to a courtroom near you!