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California To Spend 23M To Combat Auto Insurance Fraud

California To Spend 23M To Combat Auto Insurance Fraud

Wednesday’s Post 11/3/11 -  Maria Ramirez, who leads a division battling car insurance fraud in the state of California cheered when her department was given several millions dollars to aid with the investigation and prosecution of auto insurance fraud. $23M will be divided up evenly throughout all the District Attorney’s Offices all around the state of California. $15.2 million was distributed to 35 counties for the regular auto insurance fraud and $7.6 million was distributed to 10 other counties for their organized auto fraud program.  Funds are allocated to  the DA’S who are now actively involved in the investigation and prosecution of general and auto insurance fraud. The funds come from insurance companies. The amount an auto insurance carrier spends is based on the quantity of vehicles they insure. The Los Angeles County’s Auto Insurance Fraud Division was the greatest recipient of the grant. It received around $7 million as it leads the state in detecting SFC’s (Suspected Fraudulent Claims).

Ramirez, head deputy of the division, stated that the division operates “on fumes” because it could hardly cover its investigator’s salaries. According to her, there are 12 attorneys in the division, and around 20 investigators in the regular and organized auto insurance fraud sections. Without these funds, it would have been impossible to allocate an independent division to the prosecution of auto insurance fraud. Since the fall of the US Economy in 2008, auto fraud rates in L.A. have significantly augmented. Filings of false claims involving deliberate burning and stolen vehicles were among the largest among single claimants. Ramirez continues that during the past year, funding for investigation of auto fraud rings—which consists of professionals such as chiropractors, lawyers,  in elaborate fancy collisions scams—has significantly decreased. Some cases involving intricate fraud rings need more than a year of “intense surveillance”, and thus require a substantial budget for the salaries of the investigators.

-Mike 

Michael E. Dortch
President &  Managing Agent
InsureDirect.com
Corporate Home Office
618 South Broad Street
Lansdale, Pennsylvania  19446
(800) 807-0762  ext. 602