Why is insurance fraud rampant in Korea?
A nurse and a doctor at a medical clinic in Daegu and two insurance firm sales representatives were indicted without physical detention last month. Also indicted were 94 people who falsely claimed insurance payouts.
All of them face charges of insurance fraud for their involvement in netting a combined 1.1 billion won ($802,743) in payouts between 2018 and 2021.
The clinic staff, according to the police, sent a portion of the payouts to patients registered as having undergone surgery or costly treatments in medical records they falsified.
The years of fraud were uncovered after a group of insurance firms filed a report with the police, suspecting orchestrated efforts by the small clinic that reported repeated cases of high payout claims for conditions 추천 that are not so common.
Expectations are growing that cases similar to this would become less frequent, deterred by the implementation of a new law governing the penalties for insurance fraud effective Wednesday.
The long-awaited revision allows financial authorities to refer potential cases for investigation at the first signs of attempted fraud. Previously, the actionable offense was claiming payout after defrauding someone.
Experts say the revision is toothless because it falls short of recovering fraudulent proceeds. Also lacking is tougher punishment for industry insiders as part of overall strengthened penalties, a measure long advocated by the insurance industry.