Auto Insurance in Los Angeles

Staged Accidents Big Business in LA

A 2011 report released by The National Insurance Crime Bureau (NICB) shows that staged accidents continue to be a costly problem. California is the third highest state in the nation when it comes to questionable claims (QC).  The estimated annual loss has been reported at $200 million. And it’s no surprise that Los Angeles is California’s top city posting the most QCs.

Also not surprising is the fact that fraudulent claims, and in particular, staged accidents, contribute to the rising cost of insurance premiums. Honest California drivers pay the cost.

Common Scams

The Coalition Against Insurance Fraud has identified four common scams:

The Swoop and Squat. This is where a car abruptly swerves ahead of you, giving you no time to react because of the suddenness, then slams on their brakes and causes an accident with you rear-ending the auto that swerved in front of you. The scamming driver and those riding with him/her will then pretend to have serious back or neck injuries.

Shady Helpers. Watch out for any strangers that come up to you at the crash site or call you immediately after a car accident. The stranger may strong arm you into taking your car to a specific auto repair business to get it fixed. Or they might just “happen to know” of a lawyer who can help you file a lawsuit against the driver. Another ploy they might try is to get you to go see a specific physician or chiropractor. Any of these scenarios are meant to point you to others who are involved in a ring of organized criminals.

The Drive Down. This scenario occurs as you’re merging into traffic. The crooked driver will slow down and wave you ahead. He then sideswipes or otherwise rams into your vehicle, but when the police come, blames the accident on you, and claims he never waved you ahead.

The Sideswipe. In this scam, a dishonest driver will stay in the left lane of a multi-lane road on the lookout for some innocent driver who might be apt to drift into his lane. If a driver in the lane next to him drifts over close to the line, the dishonest driver then speed ups and sideswipes the innocent driver. The innocent driver will be blamed for being the cause of the accident.

Organized fraud rings

Staged accidents are not the actions of a few scattered con men looking to make some easy money. These are often the plans of organized criminal rings, involving a number of suspects. These conspiracies often include a well-organized ring of lawyers, doctors, chiropractors, physical therapists, collision repair shop owners, auto mechanics and the crooks themselves.

In April 2011, for example, 10 people were arrested in the Los Angeles area for conspiring with a Glendale attorney to bilk almost $75,000 out of an insurance company through three staged accidents.

The Glendale attorney is part of a ring of 28 defendants that are alleged associates of a Sherman Oaks legal firm that has been accused of defrauding more than a dozen insurance companies through false claims for staged accidents, collecting nearly half a million dollars.

And that is just the tip of the iceberg. The law firm’s principal is suspected of receiving millions of dollars in proceeds from more than 2,500 staged accidents over a six year period, said a spokesperson for LA District Attorney’s office.

While the preliminary hearing is for May 2011, and the outcome unknown at the time of this writing, the cost to simply investigate these and other cases can be staggering.

Reduce your risk of becoming a victim of a staged

According to Frank Scafidi, spokesperson for the National Insurance Crime Bureau, auto insurance, auto insurance criminals seek out the following:

  • Innocent older drivers driving solo in a late model car, because they’re likely to carry ample auto insurance coverage
  • Female drivers speaking into cell phones, because they’re apt to be distracted

Crooks have later told criminal investigators that they sought out distracted drivers, especially those driving while talking on the phone.

According to the LAPD and the NICB, there are a number of steps you can take to steer clear of scammers.

  • Avoid tailgating. Always allow ample space between vehicles. You need to allow yourself plenty of room and time in the event that the car in front of you slams on its brakes.
  • Don’t use a cell phone while driving, look at a map or do anything that will appear to make you look distracted while you are driving. You’ll be vulnerable if you appear distracted.
  • Be careful of wandering near the center line. Criminals committing staged accidents often prey on cars that cross the center line, and will purposely sideswipe your vehicle.

If you are in an accident or are a witness to an accident

  • Keep a disposable camera and pen and paper in your glove compartment so you’re always ready. Take pictures of the other car, the damage it received — and the passengers.
  • Count the people in the other vehicle. Criminal investigators say that in a staged accident it’s not unusual for additional criminals to file fraudulent injury claims. They’ll say they were passengers in the other vehicle, even if they weren’t in the car. That’s part of the scam.
  • Take detailed information down of all persons in the accident and ask to see drivers’ licenses. In addition to the driver’s automobile license plate, get all names, mobile numbers and drivers’ license numbers.
  • Make note of how the passengers in the other vehicle are acting. Were they joking around and then when law enforcement got to the scene, all of a sudden claimed to have serious injuries?

If you are in an accident, or you are witness to what you suspect may be a staged traffic accident, call the police immediately.