The Tourism Ministry on Tuesday called an emergency meeting with key stakeholders to prevent the possible spread of multi-million dollar insurance scams involving bogus rescues amid worries that such fraudulent activities may dent the county’s burgeoning tourism industry.

A series of news stories has been published by national and international media stating that insurance fraud has not stopped as the government had shown leniency towards companies involved in the fake rescue scam.

A highly-placed source at the ministry said that two crucial decisions have been made on Tuesday. Firstly, they are re-opening an investigation over Traveller Assist, who has been claiming to be underwriters of three insurance companies and secondly, speeding up the process to punish those involved in insurance scams involving bogus rescues in line with the investigation report of the government.

On July 30 last year, a government fact-finding committee submitted a 700-page probe report to Tourism Minister Rabindra Adhikari which stated that unscrupulous operators had been pocketing thousands of dollars from insurance companies by making multiple claims for a single chopper ride or pushing trekkers to agree to airlifts for minor illnesses.

Read: Fake rescue: Government eliminates dubious emergency operators

The committee said in its report that there had been widespread complaints of dishonest companies serving adulterated food to make tourists sick so that they could be evacuated by helicopter and in turn, receive commissions from helicopter companies and hospitals and clinics.

“One of the crucial decisions was launching an investigation over Traveller Assist. In Nepal, nobody knows the details of the company, but for the past one year, it has been harassing many companies here,” said a private sector representative who attended Tuesday’s meeting.

Traveller Assist sent a separate email to the Tourism Ministry warning that if insurance scams involving bogus rescues were not stopped by mid-February, they would be forced to stop issuing travel insurance policies for Nepal on behalf of their clients.

Traveller Assist claims it is acting on behalf of three insurance underwriters, who control twenty-three travel insurance brands, equating to over 100,000 annual travellers to Nepal, from the United States, United Kingdom, Australia and New Zealand.

“In 2018, after an extensive investigation, our company uncovered an elaborate scam that defrauded millions of dollars from global travel insurance companies,” the email sent to the ministry reads.

The email further reads: “The acts of fraud and corruption include: Pushing trekkers to agree to a helicopter for minor illnesses, multiple claims for a single helicopter and over treatment at hospitals. In addition, trekking companies were found to be purposely making trekkers sick by putting baking soda in their food and serving unsanitary food.”

The email continues, “Helicopter charter companies were found to be paying commissions to trekking companies and hospitals were found to be paying commissions back to helicopter charter companies. All of these added costs would be billed to the insurer through inflated helicopter and medical bills.”

However, a separate email sent by the same company to Manang Air on Monday, which the Post managed to get a copy, says, “We want to clear up one misconception. In our investigation, we did not identify one single helicopter company as acting fraudulently. The evidence we found was that helicopters are used as a tool by the fraudulent companies whether it be lifting a trekker unnecessarily for a minor problem or lifting multiple travellers on one helicopter and then charging insurers full price for each traveller.”

More: Global insurers threaten to stop cover for tourists

Nepali helicopter companies on Monday issued a ‘firm’ denial of the allegations contained in a series of news stories published by national and international media outlets.

Yog Raj Kandel, secretary general of the Helicopter Society of Nepal, told a press meet on Monday that no one knows about the company Traveller Assist. “All of the international media outlets have been using quotes of Danny Kaine, who says he is the head of assistance at Traveller Assist.”

Kandel said that they have asked for the bills of the companies that are normally used to claim insurance, but Traveller Assist has been refusing to provide it. “It has been harassing many companies through email and also denting Nepal’s image by encouraging media outlets to publish news without solid evidence,” Kandel said.

“I have the copy of least six dozen articles published in national and international media outlets in the last one year and all of them have the same quote from the company and most of the time it’s Danny Kaine.”  

“Not a single insurance company has complained to us. If it’s the matter of multi-million dollar insurance scam, it should definitely have a ripple effect on them,” said Kandel.   

A highly-placed source at CIWEC Hospital said that Danny Kaine threatened to blacklist the hospital if they didn’t sign an agreement with the hospital. “Danny forced us to submit all of our insurance claims through him,” said the source.

The hospital source said that Danny had claimed to represent 10 large insurance companies. “When we reached out to these companies [most of whom we had worked with for years], they all denied having signed an exclusive agreement with Danny.” “Only one company said they were trying out his services for a period of three months.”   

Jonathan Bancroft, managing director of Traveller Assist, told the Post in an email that from September to November, 2018 — Traveller Assist provided assistance for 123 cases and 94 of them required a helicopter.

“In total, we stopped 11 unnecessary helicopter lifts from happening.  We received six very large invoices from heli charter companies, but we were able to negotiate down to a reasonable amount,” he said.

“From Sept to Nov there were approx. 1,600 rescues with what we estimate were 15 percent fraudulent lifts, i.e. unnecessary. There was also still a large amount of over inflated invoices issued to insurers from heli charter companies and so called local ground agents.”

He said: “These unnecessary lifts we estimate cost insurers $1.8 million, and the over inflated invoices from both helicopter companies and hospitals cost a further $1.5 million.”

Tourism Minister Rabindra Adhikari said that the investigation of insurance scam that has been given to different agencies under their jurisdiction is ongoing. “Wait for two weeks, there will be some outcomes,” he said, without giving further details.