Norway Charges Four Individuals in Fraudulent Insurance Case

OSLO, March 26, 2025 – Norwegian authorities have charged four individuals in connection with a fraudulent insurance scheme involving the maritime sector. The defendants include a mix of nationalities: one Russian, one Bulgarian, and two Norwegians. They stand accused of forging documents and operating an unauthorized insurance business.

The charges emerged following an investigation that unveiled the activities of a company named RO Marine. This organization had been issuing counterfeit insurance documents to vessels belonging to what is referred to as the "shadow fleet." According to Norway’s state broadcaster, NRK, RO Marine claimed on its website to provide insurance for over 250 vessels, attempting to bolster its credibility by stating it operated from the same Oslo office building as the Norwegian Shipowners’ Association.

As authenticated data from the international shipping industry reveals, fraudulent insurers have proliferated amid the growth of maritime operations that lack proper documentation and licensing, often associated with the shadow fleet. The shadow fleet refers to unregulated vessels that evade traditional maritime regulations and sanctions.

Recent Trends in Maritime Insurance

This case comes in the wake of increasing scrutiny on maritime insurance practices. Recently, the Sirius Mutual Protection & Indemnity Association received a cease-and-desist notice from the Commissioner of Insurance in Mississippi, reflecting heightened regulatory actions against dubious insurance providers.

Current statistics show that 86% of the global merchant fleet is insured through 12 Protection & Indemnity (P&I) clubs that collectively form the International Group. This represents a decline from 95% prior to the escalated conflicts tied to Russia's full-scale invasion of Ukraine nearly three years ago. Additionally, the proportion of tonnage classified by established members of the International Association of Classification Societies (IACS) has decreased to 92%, down from 94%.

The analytics firm Kpler reports that more than 5,000 vessels, equating to approximately 14.5% of the global merchant fleet, are registered under flags that demonstrate less than 10% ratification of conventions set by the International Maritime Organization (IMO) and the International Labour Organization (ILO). This situation raises significant concerns regarding compliance and risks associated with enforcement actions.

Implications for Global Shipping

Dimitris Ampatzidis, a risk and compliance analyst at Kpler, noted that the increased use of high-risk flags for evasive maritime practices, such as "flag-hopping," complicates compliance efforts across the shipping industry. He emphasized how flag risks are increasingly influencing maritime due diligence and regulatory scrutiny, impacting both financial exposure and operational integrity.

The enforcement actions against sanctioned vessel operations illustrate the growing challenges faced by regulatory bodies. Kpler’s data indicates a doubling of sanctioned vessel operations since early 2023, with more than 600 such vessels now operating under high-risk flags.

This recent fraud case serves as a stark reminder of the vulnerabilities inherent in maritime insurance and highlights the need for stringent regulation to protect against fraud in the shipping industry. As authorities in Norway and beyond ramp up their efforts, the maritime community is urged to remain vigilant against the threats posed by unauthorized insurance operations.