Fraud Roundup

Nineteen arrested for auto body fraud
Nineteen suspects were arrested in California for various felony counts of insurance fraud, resulting from an extensive sting operation in Butte and Shasta counties. Seven were arrested in Butte County, and 12 in Shasta County self-surrendered to the Shasta County Jail and were released on their own recognizance, according to the California Department of Insurance.

During April and May 2006 in Shasta, and during May 2006 in Butte, the CDI Fraud Division, with assistance from the Butte and Shasta County District Attorney's offices, unearthed numerous instances of suspected fraud that could have bilked consumers out of tens of thousands of dollars.

Using information from various sources, including the National Insurance Crime Bureau (NICB), the Bureau of Automotive Repair (BAR), the Butte County District Attorney's office, and licensing data and public business directories, officers visited the shops in Butte and Shasta Counties.

An undercover officer visited 38 body shops, saying she had been involved in a car accident. The officer further explained that her car had damage to the left side as a result of the "legitimate" accident and that the damage would be covered under her auto insurance policy.

The undercover officer informed the owners and estimators that there was existing damage on the right front fender that was already present when she purchased the vehicle, but asked if it would be possible to combine the insured and uninsured damage as one claim. Eight shops provided a fraudulent repair estimate ranging from $2,000 to $3,500.

The Butte County District Attorney's Office will likely charge eight suspects with felony counts of insurance fraud. Of the eight, five are owners and three are employees.

The NICB, BAR and Esurance Insurance Co. assisted the CDI's Fraud Division and the Butte County District Attorney's office in the investigation.