A
CAUTIONARY TALE
Staged Auto Accident Fraud: Don’t Let it Happen to You
02/18/05
Consider this
scenario: You’re stuck in heavy traffic on a busy highway.
Another car cuts off the driver in front of you, forcing him to slam
on the brakes. You try to stop, but there’s no time … and
you rear-end the guy in front of you.
An everyday
accident? Not this time. Turns out you’ve been had by
a well-organized criminal ring that staged the entire thing.
This particular
scam is called the “swoop and squat.” (The first
car “swoops” in while the second car “squats” in
front of you.) After the “accident,” everyone in the car
you rear-ended—usually crammed full of passengers—will
file bogus injury claims with your insurance company. Each will complain
of whiplash or other soft-tissue injuries—things difficult for
doctors to confirm. They may even go to crooked physical therapists,
chiropractors, lawyers, or auto repair technicians to further exaggerate
their claims.
We’re
talking big money here. Staged accidents cost the insurance
industry about $20 billion a year. Those losses get passed on to all
of us in the form of higher insurance rates—an average of $100-$300
extra per car per year.
Here are some
similar scams to look out for:
- The drive
down. You’re attempting to merge when another
driver waves you forward. Instead of letting you in, he slams
into your
car. When the police arrive, he denies ever motioning to you.
- The sideswipe. As
you round a corner at a busy intersection with multiple turn lanes,
you drift slightly into the lane next to you. The car in that lane
steps on the gas and sideswipes you.
- The t-bone. You’re
crossing an intersection when a car coming from a side street accelerates
and hits your car. When the police arrive, the driver and several planted “witnesses” claim
that you ran a red light or stop sign.
How can you
protect yourself?
- If you’re
in an accident, call the police immediately.
- Report accident
claims to your insurance company. Don’t settle on site
with cash.
- Be careful with
your personal information, mindful of identity theft.
- If you can, photograph
the car and passengers and write down names, addresses, and phone numbers.
- Use medical, car
repair, and legal professionals you know and trust.
- Don’t tail
gate … drive safely.
What are we
doing to protect you from these schemes? Plenty. Like Operation
Soft Tissue, where a Chicago agent posed as a corrupt lawyer and caught
hundreds of these con artists and crooks red-handed. We’ve investigated
more than 90 staged accident fraud cases over the past decade. With
more to come!
Link: How
to Protect Yourself from Common Fraud Schemes
Photo courtesy
of the National Highway Traffic Safety Administration.
