Four suspects have been arrested in this case for reportedly scamming insurers out of half a million dollars.
Investigators in California have arrested four suspects for their alleged involvement in a car insurance fraud ring. Their alleged activities cost scammed insurers $500,000 until they were found out by the California Department of Insurance, San Diego County District Attorney’s Office, and the California Highway Patrol.
The four arrests were made earlier this month following a substantial investigation into the scam.
According to reports, the car insurance fraud ring involved dealers buying previously damaged vehicles, and then filing exaggerated claims. It also involved alleged staged thefts. When all was said and done, there were 10 suspects chargedin this scam, following Operation Dealer’s Choice, the joint task force investigation into this scheme.
The Operation Dealer’s Choice investigation was launched when a consumer call was made to the San Diego District Attorney’s Office. The call pointed out that the dealers were purchasing damaged vehicles at local auto auctions. Once the vehicles were registered and insured, fraudulent theft or total damage claims were filed in order to receive insurance payouts.
The car insurance fraud ring was found out by a special multi-department task force.
The investigation was conducted by the San Diego County Organized Automobile Insurance Fraud Task Force. That task force is comprised of the San Diego District Attorney’s Office, The state Department of Insurance, and its Highway Patrol.
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Together, they found that the scammers were carefully purchasing vehicles at auction. They could obtain these cars at low dollar amounts due to high mileage, existing damage, or a combination of the two. The scammers would insure and register those vehicles, wait a certain length of time, and once they had full coverage from a carrier, they would file claims. The scammers were sharing the profits they received from their insurance payouts.
According to the investigators, the car insurance fraud ring filed 35 fraudulent claims over a span of four years. There were a total of about 56 vehicles in use for this purpose. A number of those vehicles had their odometer mileage “rolled back” by the suspects in order to boost their value before the damage or theft was re
ported. Among the carriers that were scammed included Allstate, State Farm, USAA,Nationwide, California Casualty, Liberty Mutual, STonewood, GEICO, Esurance, Kemper, Wawanesa, and AAA.