Can someone else surrender your LIC policy and take the money ? I know you have never ever thought this can happen, because this looks so impossible, but I want to share an incident with you all which happened with Muthu (name changed), who is one of our jagoinvestor reader.
One day, Muthu came to know that 3 of his LIC policies were surrendered by someone else and the money was utilized. He came to know about this only when he got pre-closure letter from LIC for his 3rd policy. Below is the full sharing from Muthu –
I was shocked to know that someone has used my identity (signature) to surrender my LIC policies and utilized that money for their benefits.
- Firstly, my policy # 363934899 was forged and surrendered on 29.01.2013, for which LIC has issued cheque # 926895 dtd 29.01.2013 amounted Rs. 49795/- without my knowledge or consent.
- Secondly, my policy # 363934900 was forged and surrendered on 29.01.2013, for which LIC has issued cheque # 926894 dtd 29.01.2013 amounted Rs 49795/- without my knowledge or consent.
- Thirdly, my policy # 364340197 was forged and surrendered on 07.10.2013, for which LIC has issued cheque 959220 amounted to Rs 35645/- without my knowledge or consent.
I came to know about this when I received pre-closure letter from LIC after surrender of my third policy # 364340197. Immediately I raised written complaint to LIC about policies forgery on October 29, 2013. Further to my complaint, LIC recovered forged amount from the concern person and sent a covering letter along with the 4 cheques to me for the forged valve but not specifying the forged person name on the covering letter.
This incident raises some questions which are –
- When the initial cheques was issued in my name, how the money has been utilized by someone else.
- Even though requesting, LIC not mentioning forged person name in the covering letter after recovery of the forged amount.
- Did LIC filed FIR against forged person? If not why?
Who did this Fraud ?
When I came to know about this incident, the first thing which came to my mind was that it was some “insider” from LIC who did this, because its almost impossible to surrender the policy without producing the original policy document, forging the signatures and then redeeming the cheque in your own account. But the truth is that the fraud was not done by anyone from LIC office. Then Who ?
It was his Mother and Younger Brother !
Shocked ! ?
Let me now share in Muthu’s words how his mother and younger brother did this fraud.
The Fraud was done using “re-cycle” procedure
Here is exactly what Muthu shared about the fraud procedure
Since the bond was in my mother custody they surrendered that policy with the forged signature (read more about Identity Theft)
When the cheque was issued in my name, LIC agent by name Yeshoda has given a cunning idea to re-submit the cheque received in my name to LIC and another policy to issue for the same value for different name ( This process is called re-cycle procedure).
Finally once the policy has been issued in their name. They can easily surrender that policy and utilized the policy amount.
This is worst ever experience that money can change “ANY ONE”.
Do you have LIC policy ? Are you sure this same fraud can not happen with you ? How will you prevent it ?