Thread: Lawyer Among Those Arrested for Bogus Auto Insurance Claims

According to KFI radio illegal immigrants were recruited in the fraud scheme.

www.latimes.com

Lawyer Among Those Arrested for Bogus Auto Insurance Claims
By Amanda Covarrubias
Times Staff Writer

11:51 AM PST, November 23, 2005

A lawyer who allegedly headed a fraud ring that staged automobile crashes and took as much as $3 million in payments from insurers for bogus claims has been arrested, along with 22 others, officials announced this morning.

Insurance Commissioner John Garamendi said Huntington Park lawyer Bernard Laufer, 52, was taken into custody Tuesday morning at his office by California Department of Insurance Fraud investigators.

Although no one was seriously injured in the scheme, one victim was forced to close his business after his truck was totaled in a collision.

"Everybody who purchases auto insurance is paying for the fraudulent costs," said Garamendi at a news conference in City of Commerce. He estimated that 25% of all insurance costs go to fraud.

The defendants face charges of insurance fraud. Drivers could be charged with assault with a deadly weapon, according to officials.

The ring focused on SUVs and commercial trucks. Two cars driven by suspects would typically box in a victim's car on a Southern California freeway, causing a collision.

According to the department, investigators received a tip in April that Humberto Carlon, 22, of La Verne, was allegedly recruiting people to participate in staged collisions. Carlon is now serving a two-year state prison sentence.

Investigators then identified Laufer, who allegedly purchased the cases from Carlon and filed the fraudulent insurance claims against the victims' insurance companies.

"Many of the suspects Carlon recruited included friends and family, who would then allegedly recruit additional suspects and bring them to Carlon," according to a written statement by the department. "Several suspects were enticed to join the ring at a church bible study group," in the Inland Empire.

Other suspects arrested in connection with the case include: Ontario residents Daniel Hernandez, 26, Karinna Valenzuela, 22, Martha Deniz, 19, Veronica Santillan, 26, and Carlos Meza, 34; Chino residents Sonia Alburto Alvarez, 35, Alberto Espinoza, 29, Jorge Covarrubias Jimenez, 31, Angelina Alverez, 56, Jorge Jimenez, 31, Cesar Salas, 29, and Sofia Hernandez, 34; Riverside residents Juan Cervantex, 24, Maria Gonzalez, 23, Ernesto Navarro, 18, and Armando Gonzalez, 22; South Gate residents Luis Alberto Lopez, 25, and Fernando Ramirez, 30; Lakewood resident Lorena Campos, 21, Bell Gardens resident Bertha Villa, 55, and Pomona resident Veronica Contreras, 26.

"It is reprehensible to put people's lives at danger in the greedy pursuit of cash," said Garamendi. "Let this be a lesson today: if you commit a scam we will pursue you, catch you, and prosecute you to the fullest extent of the law."

Here's an article that substantiates the illegal immigrant connection.

http://www.mercurynews.com/mld/mercuryn ... 245616.htm

Posted on Wed, Nov. 23, 2005

SoCal ring allegedly staged auto crashes to bilk $3 million

PAUL CHAVEZ

Associated Press


LOS ANGELES - Twenty-three people have been arrested for allegedly participating in an insurance fraud ring that staged more than 60 auto collisions on Southern California freeways and bilked about $3 million from insurers, officials said Wednesday.

A seven-month investigation led to the arrest of Huntington Park lawyer Bernard Laufer, 52, as the alleged ringleader, said state Insurance Commissioner John Garamendi. Laufer, taken into custody Tuesday, faces charges of insurance fraud, grand theft and conspiracy.

The investigation continues and more arrests likely will be made, Garamendi said. The probe is looking into doctors and chiropractors who may have been involved in the scam.

The California Department of Insurance in April received a tip that a Humberto Carlon, 22, of La Verne, was recruiting people to participate in staged collisions. Carlon was arrested early in the investigation and has been sentenced to two years in state prison for his involvement.

A telephone call to Laufer's office Wednesday was not immediately returned.

Laufer allegedly bought the cases from Carlon and filed the fraudulent claims against the victims' insurance companies.

The ring allegedly staged more than 60 collisions using a so-called "swoop and squat" technique, which involves braking suddenly to cause a rear-end collision.

Carlon allegedly recruited friends and family into the ring and several suspects were enticed to join at a church Bible study group, officials said. People typically were paid a few hundred dollars to cause the accidents and report injuries, Garamendi said.

The ring allegedly targeted SUVs and commercial trucks.

No one was seriously injured in the collisions, but one victim had to close his business after his company truck was totaled in a staged accident, Garamendi said.

The other suspects arrested in the case were primarily people living in the United States illegally, Garamendi said.

In 1996, a family of three burned to death on the Long Beach Freeway when their station wagon was crushed between two big-rigs and exploded. Two men were sentenced to 11 years in prison after admitting they staged the accident as part of an insurance scam.

Recruited at a BIBLE STUDY GROUP??? Another shining example of the hypocrisy that we are beginning to see all over the country.

http://www.mercedsearch.com/news/455.html


Attorney arrested in connected with large auto insurance fraud ringPosted on Nov 24,2005

LOS ANGELES - The leader of a major auto insurance fraud ring that tricked unsuspecting drivers into rear-end collisions has been arrested, state Insurance Commissioner John Garamendi announced Wednesday.

Huntington Park attorney Bernard Laufer, 52, was arrested Tuesday morning. Laufer's recruiter in the scam, La Verne resident Humberto Carlon, 22, was arrested earlier in the investigation and is serving a two-year prison sentence, Garamendi said.

The San Gabriel Valley-based scam is nearly identical to one in the South Bay that Garamendi's office shut down in December, and one that has grown in scope as his office continues to investigate.

In both scams, a "stager" recruited drivers to target expensive cars or company-branded big-rigs that appeared likely to have insurance. The ring's drivers - often illegal immigrants in rental cars or junkers - would swerve in front of their victims and slam on the brakes in a move known as a "swoop and squat," members of the state's Insurance Fraud Department explained.

The San Gabriel case involves as many as 70 crashes and at least 25 recruits.

The South Bay case began with 30 known collisions, and continued investigations have expanded the number to at least 100, state officials said. A Koreatown ringleader staged the crashes on the Harbor (110) Freeway, the San Diego (405) Freeway, and the Century (105) Freeway.

Recruits in both cases were paid perhaps $100 per collision, while the ringleaders made their money by submitting fraudulent insurance claims, Garamendi said. The two scams each netted more than $3 million from insurers.

"When these kinds of insurance frauds occur, it's not just about money out of the insurance companies' pockets and ultimately out of the consumers' pockets. We're talking about life-and-death situations," Garamendi said.

"This is not a victimless crime. People have died, others have been injured, and there's an extraordinary risk whenever this kind of swoop-and-squat freeway insurance fraud takes place."

The crashes also contributed to rising insurance rates, Garamendi noted, attributing as much as 25 percent of the overall cost of insurance to fraud.

Holiday drivers should be sure to maintain a safe distance from the cars in front of them, Garamendi added.

"If you're on the freeways and somebody stops in front of you for no reason at all, just slams on the brakes, you ought to be thinking, 'This may be a staged auto accident,'" he said.

http://www.insurancejournal.com/news/we ... /62483.htm

Calif. Crash for Cash Ringleader Arrested
November 25, 2005

California Insurance Commissioner John Garamendi on Wednesday announced the arrest of the suspected ringleader of a major operation that has allegedly staged more than 60 auto collisions over the past 18 months, bilking insurers and consumers out of $2 million to $3 million.

Huntington Park attorney Bernard Laufer, 52, was arrested Tuesday by California Department of Insurance Fraud investigators, the latest break in a 7-month investigation of the case by the Department. Laufer is suspected of filing false claims for members of the collision ring after they caused dangerous crashes with innocent victims. He faces charges of insurance fraud, grand theft and conspiracy.

In April the CDI Fraud Division received a tip that a man named Humberto Carlon, 22, of La Verne, Calif., was recruiting people to participate in staged collisions on various Southern California freeways. Carlon was arrested earlier in the course of the investigation and is currently serving a two-year state prison sentence for his involvement.

During the resulting probe, investigators found evidence of as many as 70 "swoop and squat" type staged collisions allegedly caused by the group, most targeting SUVs or commercial trucks. Such an operation typically involves two cars driven by suspects who box in a victim's car on a freeway, causing a collision. The scam participants then file fraudulent insurance claims for alleged injuries.

Although none of the victims was seriously injured, the financial consequences forced at least one victim to close his business after his company truck was totaled in a collision.

Further investigation by the CDI investigators led to Laufer, who allegedly purchased the cases from Carlon and filed the fraudulent insurance claims against the victims' insurance companies. Many of the suspects Carlon recruited included friends and family, who would then allegedly recruit additional suspects and bring them to Carlon. Several suspects were enticed to join the ring at a church bible study group.

To date, 23 suspects have been arrested for their alleged roles in the staged collisions. All will face felony charges of insurance fraud, and in addition the alleged drivers in the collisions could also face charges of assault with a deadly weapon.

"It is reprehensible to put people's lives at danger in the greedy pursuit of cash," Garamendi said.

The investigation is being conducted in cooperation with several insurance companies, as well as the National Insurance Crime Bureau. The case is being prosecuted by the Los Angeles County District Attorney's Office, Auto Insurance Fraud Unit.

Other suspects arrested in connection with the case include: Ontario residents Daniel Hernandez, 26, Karinna Valenzuela, 22, Martha Deniz, 19, Veronica Santillan, 26, and Carlos Meza, 34; Chino residents Sonia Alburto Alvarez, 35, Alberto Espinoza, 29, Jorge Covarrubias Jimenez, 31, Angelina Alverez, 56, Jorge Jimenez, 31, Cesar Salas, 29, and Sofia Hernandez, 34; Riverside residents Juan Cervantex, 24, Maria Gonzalez, 23, Ernesto Navarro, 18, and Armando Gonzalez, 22; South Gate residents Luis Alberto Lopez, 25, and Fernando Ramirez, 30; Lakewood resident Lorena Campos, 21, Bell Gardens resident Bertha Villa, 55, and Pomona resident Veronica Contreras, 26.