District Attorney Charges Dozens In “Operation Insure” Fraud

A District Attorney Investigator notifies a defendant in Operation Insure of the charges against them.  More than 40 people in San Diego have been charged in connection with the operation. Photo courtesy of San Diego DA’s Office

A District Attorney Investigator notifies a defendant in Operation Insure of the charges against them. More than 40 people in San Diego have been charged in connection with the operation. Photo courtesy of San Diego DA’s Office

SAN DIEGO–District Attorney Bonnie Dumanis and California Insurance Commissioner Dave Jones have joined forces to investigate and file felony criminal charges against 42 defendants as a result of Operation Insure.

Law enforcement investigators from both agencies fanned out across San Diego County on December 19 and 20, serving defendants with notification letters informing them of the charges.

The four-month investigation targeted defendants who obtained auto insurance after an accident or theft, and then made fraudulent claims for the loss. The investigation was initiated after law enforcement agencies and the National Insurance Crime Bureau determined this is the most common type of auto insurance fraud occurring in San Diego County. The defendants were charged with knowingly presenting a false or fraudulent claim for the payment of a loss or injury under a contract of insurance, a felony. If convicted, the defendants face up to five years in state prison and a $50,000 fine.

“Insurance fraud costs the insurance industry billions of dollars a year and that cost is passed on to the consumer. Operation Insure is a warning to individuals considering auto insurance fraud that we’re investigating and prosecuting these cases, and the penalty can be steep,” said DA Dumanis. “Since this is one of the most common types of insurance fraud in San Diego County, we worked collaboratively with the Department of Insurance to hold these individuals accountable and send a strong message to the public.”

The DA’s Insurance Fraud Division partnered with the California Department of Insurance to initiate Operation Insure. All of the investigations involve fraudulent auto insurance claims being filed against insurance companies. The majority of the investigations involve fraudulent auto insurance claims filed by people who have purchased a new insurance policy or re-instated an expired policy after an accident, theft, or loss has occurred, in an attempt to fraudulently gain coverage from the insurance company for the loss. At the time of the loss, the suspects did not have valid insurance coverage and they either lied or omitted information to the insurance company when purchasing or re-instating a policy and subsequently filed a false claim. These types of fraud are felonies under California Penal Code Sections 550(a) & (b).

“Combating insurance fraud is one of my top priorities as Insurance Commissioner,” said California Insurance Commissioner Dave Jones. “When suspects allegedly collude to defraud insurance companies for financial gain, it drives up the costs of premiums for law-abiding consumers. I commend the investigators from my Department and the District Attorney’s office for their joint efforts and hard work in this case.”

The defendants were not arrested, but were notified of the charges through hand-delivered letters. The defendants have all been given arraignment dates in January, 2013, in San Diego Superior Court downtown, North County or East County. Any defendant who does not appear in court as scheduled is subject to the request for the issuance of a warrant for their arrest.

“The National Insurance Crime Bureau works to expose this kind of fraud wherever it occurs,” said NICB President and CEO Joe Wehrle. “However, exposing it is only part of the solution—prosecution delivers lasting impact. NICB commends Commissioner Jones and District Attorney Dumanis for taking an aggressive stand against insurance fraud and we will continue to provide our support to law enforcement and prosecutors as we all seek to eradicate this illegal activity.”

“The crime of purchasing insurance after a loss and then lying about an accident or theft perverts the concept of insurance and forces honest consumers to pay more. We applaud the law enforcement agencies for cracking down and sending an unmistakable public message that driving without auto coverage and trying to bilk your insurer is a dead-end street,” said Dennis Jay, Executive Director of the Coalition Against Insurance Fraud.

 

 

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