A father of four who faked his own death for more than £850,000 in insurance was caught when a friend tried to use his HMV staff discount card to buy an Elvis CD, a court heard.
Hugo Jose Sanchez, 57, worked as a web designer for the music retailer and arranged a devious plot to embezzle a fortune and start a new life in Central America, according to a report in the Telegraph
Fight back - latest on scams
Sanchez had taken out life insurance policies and built up large credit card debts, when his wife Sophie contacted his employers to inform them he had suffered a fatal heart attack during a holiday in his native Ecuador.
It is reported that he then planned to set up his own animation company in Costa Rica, where his wife and children would eventually join him.
However Sanchez was rumbled when a friend used his staff discount card to buy an CD, which triggered an investigation involving HMV, insurers and the police. When his wife presented his death certificate as proof, investigators found that it was covered in Sanchez's fingerprints.
From faking Sanchez's death and producing a fraudulent death certificate, Mrs Sanchez collected large sums from life insurance and payment protection cover, before returning to Central America. She also received a death benefit payment of £112,000 from HMV and began to receive pension payments.
The couple then fled to Australia on false papers but Mrs Sanchez, 41, was arrested at Heathrow when she returned to Britain to attend her sister's wedding. She was jailed for two years in 2010.
Following her conviction, the authorities began extradition proceedings to bring Sanchez back to Britain. He was extradited from Australia in March following a request from Thames Valley Police's economic crime unit.
Sanchez admitted 12 fraud offences at a previous hearing and was sentenced to five years in prison at Oxford Crown Court.
Insurance fraud has been steadily increasing for many years and is a contributing part to rising premiums. While few of us are so deceitful to fake our own deaths, many people do not believe that making a false claim is wrong.
In fact, over four million Brits have considered making a fraudulent home insurance claim, according to recent findings from Moneysupermarket.com - this is equal to 4.3 million or 11% of the population. Worryingly, almost 780,000 people have already defrauded their home insurer by successfully making a false insurance claim in the last five years.
Typical examples of insurance fraud include failing to disclose motoring convictions or previous claims when applying for cover, or exaggerating claims by adding extra items to a genuine claim.
More drastic examples include people hiding their valuables and staging a burglary in an attempt to claim thousands on their insurance policies, or dropping their old television down the stairs so they can claim for a new flat-screen model.
Not worth the risk
Yet while small scale fraud might not come with a five-year jail term, there are strict penalties, explains Peter Harrison, insurance expert at MoneySupermarket: "With recent news the UK has slipped into a double-dip recession, household finances will undoubtedly be stretched, but no matter how tempting, fabricating a claim for a payout is illegal, and you could face being prosecuted as a result."
"Insurance companies take fraud very seriously, no matter how big or small the amount being claimed for. If insurers are suspicious of a claim's validity it will be investigated with specialist detection processes and anti-fraud technology."
Harrison adds: "Anyone caught and found guilty of insurance fraud would find it extremely difficult to get insurance cover in the future. Previous convictions for insurance fraud must be disclosed on application forms for any type of insurance. Insurance premiums will be much more expensive for someone guilty of making a false claim, and in some cases insurers may not be willing to offer cover at all."
- 1. Land banking
Land banking involves plots of land offered for sale, often online, with the promise of sizable returns when planning permission is approved for housing or other development. Yet often the land is located in areas protected from development by planning law.</p>
The companies involved soon disappear with investors' money and as the firms are not protected by the Financial Services Authority, their funds are not covered by the Financial Services Compensation Scheme</p>
- 2. Money mule
Fraudsters recruit unknowing accomplices through email under the guise of offering employment, seeking a personal favour, or through internet shopping sites. The recruits are persuaded into receiving what are essentially fraudulent payments and then passing funds on.</p>
The 'mules' are frequently offered a small financial incentive to encourage involvement and face difficulties in proving their innocence when the fraud is discovered.</p>
- 3. Carbon credit fraud
The scams claim to offer people the chance to profit from carbon credits. Under regulations that permit businesses to emit a tonne of CO2 – the companies claim to offer investment in green projects like a forestry scheme or a solar panel project, which generates carbon credits that are then sold on to heavy industry.</p>
A flashy brochure or website tells of a reliable 'government-backed' scheme which provides reliable returns for investors. Such a scheme doesn't exist however – a reality investors only discovered when they have parted with their cash and the company is untraceable. As with land banking, fraudulent companies are not covered by the FSA so victims have no course for recompense</p>
- 4. HMRC phishing scam
Receiving an email from the taxman saying you are owed a payment may seem like a nice surprise, but it is actually from fraudsters trying to relieve you of your cash instead.</p>
The emails provide a "click-through link" to a cloned replica of the HMRC website. The recipient is then asked to provide their credit or debit card details - all the information the criminals need to clear your account, and sell on your personal details.</p>
- 5. Disappearing loan scam
This scam targets vulnerable people who are in financial difficulty and unable to access credit through regular channels like overdrafts and credit cards.</p>
The fraudsters advertise loans and those that sign up are asked to pay an upfront 'arrangement' fee of around £60-£70 fee before the loan is approved. Borrowers pay the fee only for the 'loan providers' to disappear without a trace.</p>
- 6. Crash for cash scams
Insurer Direct Line reported a hike in the number of 'crash for cash' scams last year – where fraudsters fake accidents by making unnecessary emergency stops at busy roundabouts or slip roads, forcing motorists to crash into them.</p>
They then make bogus claims to the innocent motorist's insurer, often including fictitious injuries and passengers.</p>
- 7. Driving school scams
Learner drivers have been taken for ride by being unknowingly taught by trainee instructors. An investigation by the AA found up to 27,000 extra driving tests have been failed in the last year because one in 10 learner drivers are unwittingly taught by an instructor they do not know is learning on the job.</p>
- 8. One man mail scam
July saw the arrest of a Leicester postman who stole £46,686 worth of mail over two-and-a-half years. Yogeshbhai Patel, 38, was jailed for two years for stealing mail including 2,000 DVDs and 2,250 games along with CDs and other electrical equipment. He intercepting the valuable packages and spent the money on living a luxury lifestyle including helicopter rides and a trip to Las Vegas.</p>
- 9. Smart meter scam
The Trading Standards Institute reported over 200 cases where elderly homeowners have been targeted by telephone cold callers, purporting to be from their energy supplier and offering energy saving devices which could cut their bills by 40%.</p>
The TSI tested the devices in homes where owners had fallen for the scam, only to find they both failed to satisfy electrical safety standards or deliver any tangible energy savings.</p>
- 10. Thermal camera fraud
Thermal cameras that track ATM pin numbers are the latest weapon in their arsenal and US scientists have warned it is the next threat for this form of crime. Researchers at the University of California at San Diego found that up to 45 seconds after a person types their pin code into an ATM machine or door entry pad the numbers and even the sequence are still readable by thermal cameras.</p>