A two-month joint investigation into auto insurance fraud by the California Department of Insurance and several Sacramento area district attorneys offices led to 28 arrests, including one Davis man, and several warrants beginning in late January.
According to a press release from the Department of Insurance, the cases involved one of three different scenarios.
In one kind, uninsured or underinsured suspects were involved in car accidents, but obtained insurance coverage after the fact.
In another scenario, suspects were victims of auto theft, but purchased coverage after that theft.
In the third scenario, suspects did not have insurance coverage for certain excluded drivers on their policies, but these excluded drivers were involved in accidents.
If convicted, the suspects face a maximum penalty of $50,000 and up to five years in prison.
The investigation was spurred when the Department of Insurance noticed an uptick in this type of fraud in the Sacramento region, said Jason Kimbrough, a spokesperson for the California Department of Insurance.
Kimbrough said that these claims probably came under suspicion when there were inconsistencies between dates on police reports and dates on insurance policies or inconsistencies with claims and eyewitness reports.
The bust netted 6 arrests in Yolo County alone. Dan Stroski, the lieutenant in charge of Yolo County District Attorney Office’s Auto Insurance Fraud Unit, said the Yolo County District Attorney’s office usually prosecutes three or four of these types of cases each year.
Stroski said that the frauds being prosecuted as a result of this investigation were not major.
“In this case the amount of the fraud was not that significant,” Stroski said. “We were trying to make a statement to the community. When you go to make a claim you need to be very careful.“
The country’s slowly worsening economy may have had something to do with the recent increase in activity, said James Quiggle, director of communications for the Coalition Against Insurance Fraud.
“Insurance fraud typically spikes during a troubled economy. People’s finances are shot, they feel cornered, and look to insurance schemes for easy bailouts. Normally honest people become desperate enough to risk a permanent criminal record,” Quiggle said.
Officials from the agencies involved have stressed the importance of this raid in teaching people that insurance fraud is a crime and it is not a victimless.
“Insurance fraud raises everyone’s premiums. Insurers actively fight this crime, but the costs of schemes still are passed on to all policyholders in higher premiums. That’s extra money people could’ve used to help with their kids‘ tuition, home payments or family health coverage,” Quiggle said.
The Davis man who was arrested, Blake Brown, could not be reached for comment.
JON GJERDE can be reached at city@theaggie.org.
