Database helps fight car fraud

PUBLISHED : Tuesday, 16 February, 1993, 12:00am
UPDATED : Tuesday, 16 February, 1993, 12:00am

RUMOUR has it that a massive new database of vehicle registration information is planned for Australia.

One could be excused for assuming this new database has been created because of stolen cars, but that is far from the only justification.

Apparently insurance companies are more concerned with blocking a large fraud operation which has been going on for some time.

Now, each Australian state and territory has independent computer systems controlling the registration and licensing of vehicles. The present systems are similar to those which are installed in Hongkong's Transport Department.

Problems arise when anyone - police, insurance companies or private individuals want to check the history of a vehicle. That is what the new national on-line database access will address.

Right now there is nothing preventing a vehicle being registered in two or more states and this is how the scam starts.

New vehicle registration, which is called new vehicle licensing in Hongkong, does not require the vehicle to be seen by the department officers for purely logistical reasons.

All that is needed is for the details of the vehicle - make, model, seating capacity, engine number, chassis number and the like - to be submitted on the relevant registration form with the appropriate fee to the department in the state of registration.

Some people have recognised this opportunity and regularly register new vehicles in a number of states.

The scenario for any one multi-registered vehicle goes something like this. Armed with registration numbers and plates from all states, they then proceed to insure the vehicle with different insurance companies in each state.

The car is then destroyed and the insurance assessor is called in.

The first insurance claim recovers the cost of the vehicle and the wreck is then shipped to the second state. The plates are replaced with suitably trashed plates of the state concerned, and the insurance claim procedure repeated.

Obviously the second claim produces 100 per cent profit, less the transport and sundry costs.

The third 200 per cent, followed by the fourth, fifth and sixth claims.

Fortunately, we cannot have such a scenario in Hongkong, although I imagine that there are some equally innovative schemes between the territory and the mainland.

Like Hongkong, Australia has its share of privacy activists with most of them making the mistake of thinking that invasion of privacy is a phenomenon of the computer age.

The simple act of completing an electoral enrolment form, which is compulsory for all citizens in Australia, means that one's name and address is listed in a publicly available electoral roll.

I wonder how some of our more private citizens would like that thrust on them should compulsory voting come to the territory.

I am sure that most of them would be alarmed to see a list of more than 20 other Government departments and quasi Government organisations, which will be given the additional private information contained in the electoral enrolment form.

No authorisation from the enrolee is sought. It is just announced on the form that it will be given to the other parties.

The people of Australia seem to suffer this unbelievable invasion of privacy in silence.

My point is that it really has nothing to do with computers, though I will concede that computer systems make it more convenient to distribute confidential information.

The most straightforward method of establishing the national vehicle registration database is to provide a common access to each or all of the systems which are in place.

A truly distributed database and enquiry system which will run across a multiple of hardware platforms is difficult to find these days, but the Open Systems Interconnect (OSI) international standards now make it possible to interconnect unlike hardware and software database system.

The second issue is privacy - how much of the individual or company information should be accessible to insurance investigators who are generally considered to be members of the public with no special commitments to the privacy rights of the individuals.

Of course, the insurance companies argue that the names and addresses are critical to match their own records speedily and accurately. But what price should the law-abiding individuals be expected to pay, simply to assist cash rich insurance companies prevent a few frauds?