Auto Insurance Fraud
Auto theft and auto insurance fraud are big business. Car theft is a crime that leads to the greatest number of fraudulent insurance claims than anything else.
Compared to days past, when car thieves were satisfied to break a car window and drive off with the stolen car, car thieves today use many schemes to steal cars and collect insurance money for stolen vehicles. Auto insurance fraud is committed by many people who actually still have cars they claim have been stolen, or who purposely commit car accidents to collect on an insurance claims.
If you have been accused of committing auto insurance fraud, you should consult with an experienced federal crimes attorney such as David M. Dudley as soon as possible. Mr. Dudley has been in practice as a defense attorney for over 25 years. There's little he hasn't seen in insurance fraud cases, automobile or otherwise.
Auto Theft Schemes
The following are some common car theft schemes according to the National Insurance Crime Bureau (NCIB):
- Owner Give-Ups: The car owner claims his vehicle has been stolen to receive insurance money, but he actually has somehow set on fire, destroyed or hidden the car. He may burn or cause heavy damage to it in some isolated area. He might submerge it in a lake. In some cases, owners committing auto insurance fraud have even buried their cars.
- 30-Day Specials: Car owners will claim their cars are stolen and missing. Then after 30 days, when the insurance company pays for the loss of the car, the owner pockets the money and abandons the car.
- Export Fraud: An owner, who has illegally shipped the car to another country to sell it on the black market collects on his insurance plus obtains any prohibited proceeds from an overseas collaborator who sells it.
- Phantom Vehicles: In order to get insurance on a nonexistent vehicle, the owner insures the vehicle by producing a false title or registration. The owner then reports the vehicle has been stolen and collects on his fraudulent insurance.
- Filing multiple claims for one injury.
- Filing claims for injuries that have nothing to do with a car accident.
- Illegally registering a car to another state because insurance costs less in the other state.
- A parent who registers their child's car in the parent's name to avoid higher insurance charges.
Other schemes are perpetrated on the street. Allstate Insurance Company describes the following fraudulent situations aimed at getting illegal insurance money:
- Swoop and Squat: It takes two cars to perpetrate this scheme on the unsuspecting driver. One car pulls in front of the target, another car pulls alongside him. The front car slams on his brakes and the targeted driver, with no place to go, rear ends the car in front.
- Drive Down occurs when an innocent driver trying to merge into traffic is waved into the lane by the criminal who then refuses to allow the innocent driver to merge. Unable to do so, the victim crashes into the criminal's car.
If you are accused of committing auto insurance fraud, you should call David M. Dudley. He is among the top defense lawyers working at both state and federal levels in the country. After he graduated from Harvard Law School, Mr. Dudley decided he would not join a large law firm even though he had the right credentials. He wanted to go into practice in a smaller firm where he could charge less than the standard billable hours of big company lawyers.
Fraud: Selected Case Results
- P. v. M.R.: As the manager of a law office which had purportedly presented millions of dollars in fraudulent liability claims to auto insurance companies, the defendant was charged with felony insurance fraud. Although others in the conspiracy eventually pleaded guilty to offenses which sent them to state prison, the defendant obtained a sentence of PROBATION with no period of incarceration.
- P. v. J.L.: The defendant was allegedly a major "capper" in an automobile insurance fraud ring. Although he was facing numerous felony fraud charges carrying potential state prison sentences, the defendant received a PROBATIONARY sentence without incarceration.
- P. v. J.S.: Accused of organizing an extensive automobile insurance fraud network, the defendant was facing numerous felony fraud charges. Although the defendant was purportedly responsible for almost $1,000,000 in losses to various insurance companies, the defense worked out a deal which resulted in the defendant serving only one year of actual prison time.
- P. v. M.T.: A bank repossessed an expensive sports car which the defendant had purchased by providing false information for his loan application. Because the bank received a low price of the vehicle at auction, it claimed a loss of $100,000 due to the defendant's conduct. The district attorney then charged him with several felonies. Over the prosecutor's objection, Attorney Dudley persuaded the judge to impose a PROBATIONARY sentence with no jail time if the defendant provided rapid restitution to the victim institution. The defendant did, in fact, provide such full restitution and successfully completed his term of probation. On defense motion, the court later DISMISSED the case.
- P. v. F.I.: The defendant, a day trader of stocks and bonds, purchased a considerable amount of computer equipment from a retail store, equipment which turned out to be stolen. After he was charged with felony possession of stolen property, the defense worked out a misdemeanor disposition for PROBATION which prevented him from going to jail and permitted him to remain in the country even though he was not a citizen.
- P. v. C.H.: The defendant managed a post-market automotive supply store for a famous NBA basketball player. Executing a search warrant at the store, state and local authorities found a substantial amount of stolen automotive and computer equipment. Charged with numerous felony counts of receiving, and conspiring to receive, stolen property, the defendant faced over 20 years in prison because of a robbery and kidnapping conviction he had sustained many years earlier. Attorney Dudley was able to negotiate a settlement which resulted in his client receiving PROBATION with electronic monitoring and, after the probationary term was completed, a DISMISSAL of the case.
- P. v. S.L.: As an accountant for a nationwide private air transportation company, the defendant supposedly embezzled over $125,000 from that business. Prosecutors charged her with several felony embezzlement counts. Challenging some of the documentation which the alleged victim provided in support of its claims, the defense negotiated a disposition which permitted the defendant to receive PROBATION with electronic monitoring, while only having to pay $25,000 in restitution.
- U.S. v. C.V.: The defendant was the office manager for several health clinics which allegedly defrauded the government and several health insurance companies of over $42,000,000 dollars. The United States Attorney named her as a principal conspirator in a multi-count indictment. After litigating numerous pre-trial motions, the defense eventually negotiated a disposition for approximately 22 months of TIME SERVED.
- U.S. v. J.T.: The defendant owned an international trading company which allegedly smuggled millions of dollars in illegal products into the United States from China and faced federal smuggling charges. The defense negotiated a settlement of the case which allowed the defendant to serve only six months in a prison camp.
- U.S. v. R.D.: An attorney was indicted for mail and wire fraud in federal court after filing an insurance claim for his yacht which he claimed had been destroyed by pirates in the Mediterranean Sea. Convicted at trial, the defendant hired Mr. Dudley for sentencing. At the sentencing hearing, Attorney Dudley persuaded the court to impose a prison term significantly less than that which both the government and the PSR had recommended. In the process, however, the court rejected the defense contention that a two-point upward guideline adjustment did not apply. The court of appeals later agreed with that argument and REVERSED the defendant's sentence. A subsequent resentencing resulted in the defendant's prison term being reduced.