The Fickle Finger of Fraud

It was almost a year ago that Anna Ayala complained of biting down on a severed piece of finger in a mouth full of Wendy’s chili.  Immediately, that little alleged incident sparked national media attention, a stampede of lost business and damaged image for Wendy’s, … and the start of an intense fraud investigation. Now, less than a year later, Anna Ayala and her husband are on their way to at least nine years in prison.

Anna Ayala, 40, who said she bit into the digit, was convicted for planting a severed finger in a bowl of Wendy's chili in a scheme to extort money from the fast-food chain. Her husband, Jaime Plascencia, 44, who obtained the finger from a co-worker who lost it in a workplace accident, was sentenced to more than 12 years.

In April of last year, less than a month after the alleged incident, Ayala was arrested at her suburban Las Vegas home. Investigators had found a pattern of legal claims she brought against businesses in her name or for her children.  A lengthy search for the finger's owner eventually pointed to one of Plascencia's co-workers, who lost it in an accident at the paving company where they worked, police said. Plascencia bought the tip of Brian Rossiter's right ring finger for $100 and told him what he and Ayala were plotting, according to court documents.  Rossiter later told police the couple offered him $250,000 to keep quiet.  During a recorded jailhouse phone call, Ayala bragged about how other inmates were asking for her autograph, according to a transcript of the call.

Superior Court Judge Edward Davila, while sentencing the couple, indicated that "Greed and avarice overtook this couple," and that the pair had "lost their moral compass." Kind of an understatement, don’t you think?

The two pled guilty last September to conspiracy to file a false insurance claim and attempted grand theft with damages exceeding $2.5 million. Although authorities immediately suspected a hoax -- in part because the finger was not cooked -- word of the stomach-turning find quickly spread around the world.  The fast food chain has claimed that it lost $2.5 million in sales because of the bad publicity, and dozens of workers at the company's Northern California franchises were laid off.
A Wendy’s executive attending the proceedings asked the judge to send a message that "consumer fraud is a serious crime that demands a severe penalty", while, in a tearful plea for leniency, Anna Ayala apologized to the courtroom gallery and said the scheme was "a moment of poor judgment." Yea….right…only because she got caught.

Earlier, Ms. Ayala watched news footage of herself describing how, while sitting with her family at a San Jose Wendy’s last March 22, put crackers in her chili and started eating until she chewed on something "kind of hard, crunchy." After spitting it out she realized it was a human finger.

"There's no words to describe what I felt. It's sick, it's disgusting," she said in a clip played before sentencing. "Just knowing there was a human remain in my mouth is tearing me apart inside."  (Isn’t it amazing what people will do for money?)

During a storm of interviews and national media attention immediately following the announcement, an increasingly agitated Ayala denyed to reporters she put the finger in the chili, asking them on camera, "Where would I get a damn finger?" Forensic tests later showed Ayala never really bit down on the finger.  (Do we dare doubt that she even had it in her mouth?)

The couple’s sentencing followed a 90-minute hearing in which several Wendy's employees testified, including the man who made the chili and the cashier who helped Ayala on the day she made the claim.

"I felt so bad for the fear of what people would think of me," said Hector Pineda, who made the chili and initially came under suspicion. "We are the ones that have suffered."

Cashier Jose Pacheco said he bore the brunt of Ayala's tirade after complained about the chili. "She asked me who I killed to get the finger," Pacheco said.  No Wendy's employee was missing a digit at the San Jose restaurant, and no chili suppliers reported finger injuries at their plants. 

The couple has been ordered to pay about $170,000 in restitution for workers' lost wages as well as nearly $21.8 million to Wendy's International and JEM Management, which owns the restaurant. Both corporations, however, have agreed not to collect from the couple, provided they never benefit from the ruse. (So I guess they can’t write a book or authorize a screenplay from prison, heh?)

Yes, fraud is alive and well in this country, and corporate America, the insurance industry, and you and I are paying for it. Yet there are two things that can keep fraud in check…one, over which we have little influence, is the punishment of those who commit this criminal act.  The other, however, is high quality, curiosity-based factual investigations that start from the moment a claim is made and the adjuster gets it in his or her hand.

In the past 20 years, the depth and breadth of our factual investigations have suffered. Most our younger claims generation has never had the opportunity, or the pleasure, of handling claims face to face, in the field, where the face to face contact, instinct and intuition provide an entirely different dimension of factual development.  Consequently, it is easy to understand why so much fraud goes unchecked.  Even well developed SIU organizations have marginal opportunity to make an impact…as the opportunities are often lost well before they get the assignment.

If we are truly committed to our profession, those of us who have had this experience have a moral, if not ethical, duty to help the new generation of claims adjusters develop their own “CSI-ness”, while also understanding that, despite all the hype in recent years, the amount of fraud is still a very small percentage of the whole claims population. It is just as wrong for the claims community to commit fraud “over-kill”.  As claims professionals, it is our job to help those who have truly suffered loss, to pay what is owed, no more, no less…and for those who seek to defraud…to do our part in seeing that they are caught. It is that sensitive balance that we must teach and develop in our younger claims generation.

James W. Greer, CPCU<br>
AE21 Incorporated<br>
Association of Property & Casualty Claims Professionals (PCCP)
Association of Workers’ Compensation Claims Professionals (WCCP)