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Archive for the ‘INSURANCE FRAUD’ Category

Insurance for kidnapping is not cheap but what do you expect

It is a hazard of Doug Milne’s job that sometimes his valued clients – people he considers friends – are murdered. He is not a member of the security services, however, but an insurance broker, albeit one who focuses exclusively on kidnap and ransom insurance for companies and wealthy individuals. That he describes himself as an insurance broker at dinner parties rather than recount some of the more dramatic aspects of his work is typical of his very British sense of self-restraint.

Take his attitude to some of his experiences when travelling for business (he refuses to say whether he is insured against kidnap himself, as this would nullify a policy). Mr Milne recalls taking a taxi from Bogotá airport in the mid-1980s when three people pulled up alongside him waving guns. After swerving across the road they managed to pull off down a slip road. “These sort of things happen,” he shrugs in a conference room at the company’s London headquarters. “You get so used to it. Your adrenalin goes crazy but afterwards you have a drink and get over it.”

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His wife, he says, is used to seeing him off as he departs for dangerous destinations. But these days he tends not to give her “a lot of notice if I’m going somewhere like southern Iraq. I’d rather put up with the aggro just for a couple of hours than a few weeks”.

Despite this buttoned-up approach, the 53-year-old chief executive of Special Contingency Risks, a subsidiary of insurance broker Willis, says he is affected by the deaths of clients. He recalls one individual he used to stay with in Colombia, a “very dynamic, macho man”, who was kidnapped by “some of Pablo Escobar’s men”. Two weeks after he was released, when the ransom was paid, Mr Milne’s friend spotted one of his kidnappers at a bullfight – the police subsequently arrested six people. A year later, as they were being sentenced, three men burst into his office and “butchered him to pieces” in view of his girlfriend. “I was completely and utterly shocked,” he says.

Do such experiences make him more cautious about becoming close to clients?

“No, I went to a Scottish boarding school,” he offers by way of explanation for his stiff-upper-lip approach.

Born in Qatar, “of oil company stock”, he spent much of his childhood moving around the Middle East. His parents met in Basra, Iraq – his mother was there to get work experience with an Iraqi trading family and his father was an oil engineer working for the Iraq Petroleum Company, a consortium of the world’s largest oil groups.

After boarding school, he tried his hand at art, hoping to “find some hidden talents. I didn’t”.

A year later he snapped up the offer of a job at Willis to “look after all the unusual bits of insurance no one else wanted”. This included twin insurance – in the days before antenatal scans, parents could buy insurance against the additional cost of bringing up twins.

Another part of his “mixed bag” of products was looking after kidnap insurance. “It was a lot more interesting than twins,” he says.

Convinced this was a growth area, he persuaded his boss to send him to Colombia and Peru in 1982, then hotbeds of kidnapping. After a two-week language course in Spanish, he flew to Bogotá. “I came back to London with a full order book. My boss agreed I could specialise and gradually we built up a business,” he says.

Now, in addition to insurance, SCR provides security advice and his team ranges from accountants to security professionals with a military and police background.

Mr Milne says he is on call 24/7. He may pick up the phone at any time of day to a security manager of an international oil company or the wife of a billionaire alerting him to a kidnap.

The level of ransom varies by country. “I came across a company that had a couple of oil engineers kidnapped in Niger – they claim to have paid $30m to have them released. I would have paid less than $1m for an oil engineer in that area.” Paying such inflated prices, he says, distorts the market and inflates kidnappers’ expectations.

Broadly, he identifies two types of kidnapping. First, there are those that are highly organised, where the target has been followed extensively. “It might have cost them $30,000 to set up so there’s no point in offering less than $30,000 as there’s no return on equity,” he says. “These require a lot of financial negotiation.”

Then there are “cheap and cheerful” kidnappings. “These are random; you might be stopped in your car, beaten up and locked in the trunk. Your loved one will be called and asked for $30,000. There is very little negotiation involved in that. Our best strategy is prevention and having a contingency plan that includes having cash in the house to pay the ransom.”

As these are a lot less professional (often carried out by individuals on drugs) they can be very violent and the risk of death is high. “They are smaller in terms of financial demand but more expensive psychologically,” says Mr Milne. “One of the interesting things about kidnaps [is that] you might get a victim who’s been held in a Colombian jungle for a year, will come out quite fit, well cared for … quite upbeat; whereas the victims in these shorter kidnappings are quite traumatised.”

A growing part of his work is expatriate evacuation triggered by political upheaval. This year he is closely monitoring Algeria and Saudi Arabia.

Last year the company helped move employees of international companies from Libya and Egypt. “We had 52 clients in the area who had contingency plans but once the air space was closed, the plans fell away.” The key lesson was that “the best plans don’t work. You need lateral thinking”.

Piracy is another area that has grown in recent years and the sums are much higher than in individual kidnappings. “If it was an oil vessel, paying less than $10m is unlikely and generally a ship might be held for over 200 days,” he says.

Every day there is a new scenario developing, he says, so his even temperament is important.

Is he a typical insurance broker? He emits a deep throaty laugh. “No. And I’ve no desire to move to other parts of the insurance world.”

WANTED DEAD OR ALIVE

Being  uncommon, faking one’s death is not new to the world. We’ve seen it in the play  Shakespeare’s Romeo and Juliet, on TV with shows like 24 and in the news This short list looks at ten men who committed pseudocide, pulled a Reggie Perrin, or, in other words, faked their death for one reason or another. This list is in no particular order.

10

John Darwin

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John and Anne Darwin, a couple who lived beyond their means, had acquired debt of tens of thousands of pounds. They decided to escape their debt by faking John’s death and collecting the insurance money. On March 12, 2002, John left in his canoe and disappeared. A large search ensued and, on March 22, 2002, John’s wrecked canoe was found. In February, 2003, he was declared legally dead, allowing his wife to cash in on the insurance policy and pay off their debt. This left enough money to start a new life that, eventually, took them to Panama.

On December 1, 2007, John turned himself in to the police, claiming to have no memory of what happened and believing he was a missing person. The police had started looking into his disappearance three months before he turned himself in, and the ruse was uncovered when it was proven he had been with Anne the whole time.

9

Ken Kesey

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Ken Kesey was an American author best known for his book, “One flew over the Cuckoo’s Nest.” He joined the CIA’s experimental program on the effects of LSD. After publishing his book, he continued using drugs, eventually getting involved with Timothy Leary. In 1965, Ken was arrested for possession of marijuana. This led to the idea of escaping jail time by faking his death.

Ken, with the help of his merry pranksters left his truck on a cliff near Eureka with an elaborate suicide note. His friends then smuggled him to Mexico where he remained for eight months. On his return to the United States, he was arrested and sent to jail for five months.

8

Lord Timothy Dexter

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Timothy Dexter was a self-proclaimed Lord, born in Massachusetts in 1748. He was a prime example of a self-made man, having little to no education and accomplishing so much. He became an author, publishing his book with no punctuation and horrible spelling. Originally, he had to give it away, but it immediately became popular and went to the eighth edition printing. His second book included an extra thirteen pages of punctuation, with a note saying, “place it as you please.”

Timothy decided he wanted to know what people would say about him if he were dead, so he faked his own death and made plans for a funeral. Three thousand people attended the wake and, because his own wife didn’t cry for him, he decided not to reveal himself. Later, he caned his wife for not showing sympathy and crying. He officially died on October 26, 1806.

7

Bennie Wint

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Bennie Wint led a troubled life, deeply into drugs and involved with a South Carolina drug ring. He decided he needed to start a new and better life. He felt the only way he could do this was if everyone thought he was dead. While on vacation with his fiancée, in September, 1989, he swam out past the breakers at Daytona Beach and disappeared.

He left behind his fiancée and a four-year-old daughter from a previous marriage.  Bennie made a new life in North Carolina, under the name of Bill Sweet. He acquired a common-law wife and had a son. Neither knew anything about his identity until he was stopped for a traffic violation, in January, 2009. His fingerprints came back as belonging to a dead man, so he came clean and told his story.

6

John Stonehouse

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John Stonehouse was a British politician who got in over his head during his business affairs. He started cooking the books and got wind that the Department of Trade and Industry was looking into his affairs. He started moving money and set up a new identity as Joseph Markham. On November 20, 1974, he faked his own suicide by leaving a pile of clothes on a beach, making it appear that he drowned. He was, instead, on his way to Australia to make a new life with his mistress.

John was caught in Australia by an astute banker who caught on to the fact that he was moving money under more than one name. Police first thought he was the fugitive, Lord Lucan, who, two weeks before Stonehouse, was believed to have faked his own death as well. John was identified by a photo of himself on a list of the recently deceased and was arrested on December 24, 1974.

5.
Alexander “Ace” Baker

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Ace Baker is an American composer and keyboardist. He played with the Supremes, Iron Butterfly and Reo Speedwagon. Ace is also a 9/11 conspiracy theorist. His theory is based on the Hutchison effect, and claims that the planes in the video were faked.  Ace was doing a radio program, The Real Deal, with host Jim Feltzer, with other members of the 9/11 truth movement when Ace felt that he was receiving unfair treatment. He then made references to his deceased parents and asked for forgiveness from his wife and children. Shortly after, he left the phone line and gun shots were heard. Ace later called it performance art.

4

Friedrich Gulda

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Friedrich Gulda was an Austrian pianist in both classical and jazz fields. Gulda is most famous for his Beethoven interpretations, though Mozart was his idol. Gulda had a strong dislike of authorities, and declined the honor of receiving the Beethoven Ring for his performance.

Gulda is perceived as one of the twentieth century’s outstanding pianists. His unorthodox styles of mixing jazz and classical earned him the nickname of “terrorist pianist”. Cementing his nickname, Gulda faked his death in 1999, and reigned as enfant terrible among pianists. Gulda also expressed a wish to die on his hero, Mozart’s, birthday. On January 27, 2000, he did just that

3

Philip Sessarago

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Philip Sessarago was a military man in The Royal Artillery with aspirations of joining the SAS. He failed to be accepted twice by the SAS. He saw himself as a James Bond type and was disappointed not to be a part of the SAS. In 1993, he faked his death by claiming to detonate a landmine in Bosnia. He changed his name to Tom Carew and a penned the book, Jihad!

The book was on its way to being a best seller after being serialized in the New York Times. Jihad! was released in paperback the day before the 9/11 attacks. The book’s timing was perfect as he claimed to be an expert on the tactics used by the terrorists, which led to many interviews. In a 2001 interview his deception came to light when he was recognized by his children.

2

Arthur Bennett

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Arthur Bennett was a Marine Staff Sergeant. He was accused of sexual assault charges in 1994, and allowed to go free. On February 3, 1994, the trailer he was living in was found burned to the ground with a badly charred body inside. The body was believed to be Arthur’s and was cremated and buried with full military honors.

Arthur assumed the name of Joe Benson and, with the help of his family, moved to Hurricane, Utah. To cover his identity he dyed his hair red and wore blue contacts over his brown eyes. Arthur was found out when he was accused of molesting his daughters and a neighborhood child. Fingerprints proved he was really Arthur Bennett. He was arrested October 31, 1997, and pled guilty in 1998. He still had a court martial to deal with when he hung himself in his cell, on July 12, 1999.  The body found in his trailer has never been identified, and there is no way to identify it as it was cremated.

1

Jenaro Jimenez Hernandez

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Jenaro Hernandez went out spear fishing early on April 13, 2008. When he didn’t return home, his wife reported him missing. The Civil Guard found his car and belongings, but his scuba gear and fishing stuff was missing. The only thing they found was his flipper.  Jenaro was heavily in debt, which led police to suspect he had faked his death. The family didn’t believe he would do that, as he had a young child at home and another that was due soon. He was found in South America and was extradited back to Spain and arrested.

Bonus

Lord Lucan

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Richard Bingham, the seventh Earl of Lucan, on the night of November 7, 1974, killed the family nanny, Sandra Rivett, and tried to kill his wife. She fled for safety and Lord Lucan fled to several friends before arriving at a friend’s house, 42 miles away. Friends and relatives believed he was innocent and jumped to help him, while police were being slow on the uptake. The car he was driving was found on the coast of Newhaven and there was no sign of Lord Lucan. Some friends believe he committed suicide due to his grief over murdering the nanny, by mistake, instead of his wife. Others believe he disappeared and is innocent and alive to this day. Sightings have been reported in South Africa and New Zealand.

 

 

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