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Lucky Ambrose was about to retire as a flight attendant at Italian International Airlines. His retirement salary would allow him to live – barely – in Barstow, California. In a stopover in Rome, he found a way to retreat in comfort while surfing at the Vatican Art Museum.
He bought a disposable flash camera in the souvenir shop and began taking photographs of works of art in the museum. Of the twelve pictures he took, two were relatively clear, stained only by a white spot from the flash reflected from the oils. They were pictures called:
- “San Giorgio Che Occide Il Drago,”
- Paris Bordone’s 1525 painting of St. George killing the dragon and
- “Madonna Della Pera,” painted by Alessandro Buonvicino, known as Moretto Diana Brescia, 1505.
Ambrose reported a burglary at his home in Barstow, claiming $ 555,000. The Good Neighbor Insurance Company, which was facing an alleged loss of two Italian Renaissance paintings stolen from the bedroom of his California ranch, believed they had no choice but to pay the sum insured.
They were only suspicious because the allegation contained several red flags for fraud, such as:
- The loss occurred within three weeks of the issuance of the insurance;
- There was no written evidence that the items had been purchased by the insured;
- The items were unusual and difficult to market while his TV, VCR and stereo system were still in the house after the burglary; and
- The only proof of ownership Ambrose offered when he insured the works were the two amateur snapshots of the paintings.
Suspicions and red flags are not enough to deny a claim. Lucky Ambrose was paid what he asked for and signed a subrogation and rescue agreement that transfers all his rights to the paintings to the insurance company.
The insurance agent who visited Ambrose’s house in Barstow testified that he believed in Ambrose when he learned that the paintings were inside the drawers. “We are in a business of utmost good faith,” he said. “Why should I not believe him? He had paid his premiums regularly for the past five years.”
“If (the agent) had any questions about it, if he did not feel that everything was in order before issuing the insurance, we would have taken all the necessary steps to ensure that it was genuine,” a good neighbor spokesman testified. The spokesman for the good neighbor also testified that when the paintings were reported stolen just three weeks after the policy was issued, they had “suspicions … but since we had no evidence or anything to substantiate an assumption that something was wrong, we were forced to go ahead and pay claims. “
The jury ruled in favor of Good Neighbor for the amount paid, interest according to legal interest and legal fees.
The state of California investigated whether Ambrose should be arrested but imitated the actions of the US prosecutor. He could have gone to jail. His retirement plans could have been ruined by an Italian police officer who knows art better than agents, insurers and tortfeasors at the Good Neighbor Insurance Company.
He sold his house in Barstow and moved to Boise, Idaho before the state of California and the U.S. prosecutor had time to change. He now lives a quiet and honest life on his pension in Boise and tries to get used to snow in the winter.
Not even a well-trained, experienced fraud investigator, when saving some money for the insurance company, can help convince a prosecutor that a case can be proven by fraud beyond a reasonable doubt. For a prosecutor, it is easier to convict a person accused of a violent crime against an innocent person with a three-page police report rather than a detailed investigation that shows that a person is trying to steal from an insurance company.
(c) 2022 Barry Zalma & ClaimSchool, Inc.
Barry Zalma, Esq., CFE, now limits his internship to the position of insurance consultant specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders. He practiced law in California for more than 44 years as a lawyer for insurance coverage and claims management and more than 54 years in the insurance industry. He is available at http://www.zalma.com and email@example.com.
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