Fraud Motives – It’s Greed vs. Need

Fraud is Everywhere

Last week, I was scrolling through several news stories on my phone, and there were quite a few stories popping up where the government indicted or got convictions against healthcare providers accused of committing insurance fraud.

The thing that immediately struck me about these stories was the phrase “fraud motives.” Very seldom do you hear about a case where someone committed fraud because they truly needed the money. It happens so rarely that, when it does, you’re actually surprised. When it comes to fraud motives, necessity based frauds are more often than not the exception and not the rule.

Fraud Motives – Greed vs. Need

Most cases we see prove that fraud is more often than not a case of greed vs. need. Case in point, if you were to go to Google and type in the phrase “Doctor Accused” you’d see headlines like this:

  • Doctor accused of billing Medicare $375 Million for nonexistent treatments
  • Michigan doctor accused of defrauding Medicare by filing $35 million worth of claims for chemotherapy treatments that patients didn’t need
  • Tenn. doctor faces charges of bilking Medicare of $7.5M
  • Valley doctor bilks Medicare out of more than $3 million    
  • Bethesda Doctor Ordered To Pay $17 Million for Health Care Fraud

I Had to Feed my Kids…

At $375,000,000, really?!

Are we all supposed to believe that these doctors needed the millions of dollars they stole in order to feed their children, put a roof over their head, keep the lights and utilities on, or pay for some type of life threatening medical care for them?

Of course, we’re not.

When it comes to fraud motives, given that need based cases are the exception, these doctors just wanted to live more extravagant lifestyles. They didn’t need the money at all.

It’s About Healthcare Fraud, Right?

On the surface, one might think this blog is about medical providers committing healthcare fraud or a story about Medicare fraud. It easily could be as healthcare fraud is a significant issue for government regulatory and investigative agencies given all the fraud, waste and abuse which is prevalent. That, however, is not the focus.

No, this is really more of a commentary on fraud motives and the reasons why individuals commit fraud.

It’s about greed vs. need.

Gekko Called It!

The infamous Gordon Gekko, played by Michael Douglas in the 1987 movie Wall Street, echoed this sentiment when he said “The point is, ladies and gentleman, that greed, for lack of a better word, is good. Greed is right, greed works.”

But $375,000,000 is a lot of greed.

I know most doctors have higher student loans than the rest of us, but seriously, these kinds of cases have little to do with that. Very simply they’re nothing more than an egotistical, greedy, “I want a different lifestyle,” money grab.

Think of the Things You Can Buy with $375,000,000

Sure, we’d all like to have $375,000,000 to spend on whatever luxurious things we want to own and probably never will. But we don’t need them.

Fraud, for the most part, is a lifestyle crime. For many, it’s about “keeping up with the Joneses” or living an opulent lifestyle. It’s not about need – it’s about greed. In one news story, the last line illustrated this point quite nicely…

If the cash is not forfeited, authorities say they will seize assets belonging to the two, including a Porsche sports car and a Roll Royce roadster, as well as a house.

Putting an Understanding of Fraud Motives to Work

So, why talk about fraud motives? Well, for starters, if you understand why people do the things that they do, you’re more able to detect, investigate, and prevent the risks associated with these kinds of fraud losses.

When it comes to fraud motives, no one needs $375,000,000 simply to live day to day. Greed dictates that people commit fraud so that they can steal $375,000,000 that they weren’t otherwise entitled in order to “live the high life” and buy: expensive cars, houses, jewelry, art, clothes, vacations etc.

Why not? As was the theme in the 1991 movie starring Danny DeVito, “it’s other people’s money!” (OPM).