Keep an Eye Out for these Auto Insurance Scams
1. Counterfeit Air Bags
Jim Quiggle, a spokesman for the Coalition Against Insurance Fraud in Washington, D.C., says this in reference to repairing deployed airbags after car crashes: “Crooked repair shops frequently replace the bags with cheap knockoffs, or in some cases just fill the area with junk and garbage. The insurer pays for phony work, and the driver ends up with a car that isn’t safe.”
To ensure this doesn’t happen to you or a customer, recommend visiting a reputable mechanic that is provided by the insurance company, get a vehicle report when buying a used or salvaged car, and take notice of the air bag light that flashes briefly when the car has been started.
2. Staged Accidents
The National Insurance Crime Bureau reports an alarming 102% increase in suspected cases of staged accidents between the years of 2008 to 2011.
Some common types of staged accidents:
“Swoop and squat”: Two vehicles trap a victim in a rear-end collision.
“Drive Down”: The victim is waiting to make a left turn but is tricked into turning early by an oncoming driver. The driver waits at first and then advances to collide with the victim.
“Wave Down”: Two drivers orchestrate a crash with a victim who’s given the ok to pull out of a lot or side street.
“Enhanced Damages”: After a genuine crash, the driver who is not at fault fabricates additional damage to his or her own vehicle to collect a higher payout from the claim.
3. Windshield Replacement Scams
Consumers are being approached in parking lots by people claiming to be with a windshield repair or vehicle glass company. They are telling consumers that their vehicle’s windshield needs to be replaced, and it will be at no cost after the consumer provides their insurance information.
Sure, they are getting a new windshield, which is most likely in worse shape than the one that “needed to be replaced”. Also, this has opened up the opportunity for this scammer to submit false claims to the given insurance company.
4. Towing Scams
Authorities are telling consumers to watch out for “bandit” tow trucks, in reference to the tow trucks that just luckily show up after the car has been damaged in an accident or breaks down without being called first. Consumers are coming home with outrageous bills.
Be sure to let your consumers know if you offer roadside assistance with their specific policy, and the consumer should inquire about the policy’s limits in regards to towing, storage fees, etc. before leaving the scene.
5. Auto Premium Evasion
Whether customers purposely use a false address from a lower-premium area when registering their vehicles or purposely fail to add the new teenage driver to the family policy, this is costing the auto insurance industry an average of $16 billion a year, according to The Insurance Information Institute.
Sting Operation Seizes NJ Public Adjuster Before a Hit to NJM
According to Ed Beeson of The Star-Ledger, Joseph Shammah, a public adjuster out of West Long Branch, New Jersey, has been indicted on second-degree insurance fraud among other charges this past April. Shammah was a public adjuster, licensed by the state of New Jersey and hired by consumers to assist in settling insurance claims for higher payouts, with an average of 10 percent of the settlement money being paid to the adjuster. Shammah was caught red handed during a sting operation geared to expose fraud committed by public adjusters.
“Operation Home Makeover” exposed Shammah after he visited one of the homes utilized in the sting operation. He filed false statements about damage to the home for the purpose of collecting over $15,000 from New Jersey Manufacturers.
“It is not unusual for a person caught in a sting to not know they are facing charges until after they have been indicted,” said Peter Aseltine, Attorney General’s Office spokesman. And since Shammah was not arrested during the sting between April and August of 2012, he was pleasantly surprised (but declined comment) when he was approached by The Star-Ledger. Shammah is facing up to ten years in state prison.
Vigorous Reality Show Participant is “Disabled” Retired Cop in NJ
Eunice Lee of The Star-Ledger reports the story of Joseph Derrico, a retired Hamilton Township, New Jersey police officer, collecting a disability pension of about $70,000 per year. New Jersey Watchdog and NBC 4 New York report that after Derrico’s retirement in 2010, he’s starred on truTV’s “Bear Swamp Recovery,” a reality “repo” series that claims to be the “baddest towing team in Jersey.”
The “Monster Truck Showdown” episode, which aired approximately one year after the receipt of his first pension check, featured Derrico chasing a monster truck on foot and throwing the driver out of the truck to the ground.
Another employee of the Bear Swamp repo business, P.J. Vinch, stated that Derrico, along with the rest of the crew, didn’t actually participate in strenuous activity. According to Vinch, the show “was all staged. Nobody was exerting any physical activity. Nobody was actually fighting; it was mocked for TV.”
If Derrico had been convicted of theft by receiving stolen property before his retirement, a felony charge he had been indicted on by a grand jury in Mercer County in 2010, his benefits would have been reduced or stopped altogether. But Mercer County Prosecutor, Joseph Bocchini, dismissed the case.
Unfortunately for Derrico, he has retired less than five years ago, which means state authorities can order a re-examination to determine whether he is still disabled.
MCMILLEN V. HUMMINGBIRD SPEEDWAY, INC.
Plaintiff, Bill R. McMillen, Sr., suffered injuries that resulted in possible permanent impairment, loss and impairment of general health, strength, and vitality, and inability to enjoy life, and decided to seek damages from defendants Hummingbird Speedway, Inc., Louie Caltagarone, Dave Resinger, and Josie Lee Wolfe. Josie Lee Wolfe rear-ended McMillen during the “cool down lap” after a stock car race at Hummingbird Speedway, Inc.
According to public posts on McMillen’s Facebook, he had spent some time after the accident on a fishing trip and traveled to the Daytona 500 in Florida. This determination led the defense to seek an order for the plaintiff to reveal usernames and passwords to his Facebook and Myspace accounts to determine if more relevant information had been posted that could possibly contradict this personal injury action. And since Pennsylvania will accept any evidence relevant to “the prosecution or defense of a lawsuit, access to those sites should be freely granted.”
The court states, “Yet reading their [Facebook/Myspace] terms and privacy policies should dispel any notion that information one chooses to share, even if only with one friend, will not be disclosed to anybody else.”
These cases not only solidify the importance of utilizing Internet Profile Reports as a staple in the investigative process, they also show some insight on judges’ thoughts when a claim has crossed over into the litigation process.
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LARGENT V. REED
Another victory on behalf of utilizing social media to prove or disprove claims occurred during the Largent v. Reed civil case in a Pennsylvania court room. The plaintiffs, Keith and Jennifer Largent, claimed suffering from permanent mental and physical injuries sustained during a motorcycle vs. car accident with the defendant, Jessica Reed. Reed had struck a minivan driven by an additional defendant named Sagrario Pena (who is not relevant to this part of the case). Pena’s minivan had been pushed into the Largent’s motorcycle.
But, according to Jennifer Largent’s public Facebook page, she was living a fulfilled life with family and a workout at the gym. Defendant then “moved to compel disclosure of Plaintiff’s Facebook username and password” upon learning this information, and Judge Walsh approved the motion.
Jennifer Largent raised objections including relevancy and discoverability, privacy, Stored Communications Act, and an annoyance, but Judge Walsh dismissed her objections with these reasons:
- Electronic evidence is fair game if relevant.
- No social media privacy exists. Judge Walsh explained, in his opinion, “only the uninitiated or foolish could believe that Facebook is an online lockbox of secrets.”
- Stored Communications Act is only to protect users from the government seeking information from their Internet Service Providers (i.e. Verizon, Comcast, etc.). The plaintiff is not an Internet Service Provider.
- It would not be an annoyance because the defendant would be responsible for retrieving the information and, according to the court, “this is one of the least burdensome ways to conduct discovery.”
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ROMANO V. STEELCASE INC.
INVESTIGATOR NOTE: ICU Investigations is dedicating this April issue of our newsletter to inform our clients about the importance of utilizing Internet Profile Reports as a staple in their investigative needs. The next three articles highlight three major case law summaries that have changed the way the judicial system views privacy on social media and the way we utilize social media in the investigative industry.
ROMANO V. STEELCASE INC.
Plaintiff, Romano, claimed that permanent injuries sustained prevented her from enjoying life, resulting in confinement to her bed and home. Defendant, Steelcase Inc., wanted to use the plaintiff’s “private” posts on her social media sites as part of the case, claiming that her posts contradict the personal injury action and prove her ability to live a healthy lifestyle, such as a photo of Romano “smiling outside of her home.” If Romano was forced into the confines of her own home, why was she posting pictures outside, living a lifestyle she claimed was unattainable?
The Stored Communications Act prohibited the social media sites from releasing information posted by the plaintiff, but the defendant filed an order that allows access to the plaintiff’s social media accounts, current and historical pages, including any deleted pages and information.
The court reviewed instructive Canadian cases and the New York court ultimately approved right of entry into the plaintiff’s pages with the “reasonable likelihood that the private portions may contain evidence relevant to plaintiff’s claim about lifestyle loss, and preventing defendant from accessing her private postings would be in direct contravention to the liberal disclosure policy in New York State.” No social network platform can guarantee “complete privacy.”
The court concluded that when the plaintiff signed on to Facebook and MySpace originally, “she consented to the fact that her personal information would be shared with others, notwithstanding her privacy settings.” With the purpose of these sites being to share your information, it concludes that the reasonable expectation of privacy does not apply.
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