NU Online News Service, Jan. 11, 12:00 p.m. EST

A two-year investigation by the California Department of Insurance's Fraud Division has resulted in the arrest of 20 people allegedly involved in a Los Angeles-area auto insurance fraud ring that cost insurers more than $1 million.

The leaders, according to authorities, were Norberto De Jesus Rivas and Albert Lee Ingram. Mr. Ingram is the owner of Metropolitan Health Care Center and Wilshire Health-Care Centre.

The insurance department said Mr. Ingram's facilities allegedly “produced fraudulent medical reports and invoices for claimants that either never received treatment or for claimants that simply did not exist.”

Insurers victimized included 21^st Century Insurance, Esurance, Commerce West, State Farm, Mercury Insurance, Allstate, Infinity, Wawanesa and Farmers. Each helped with the investigation, the insurance department said.

Local and federal authorities also assisted, along with the National Insurance Crime Bureau.

Others arrested included those who solicited Mr. Rivas to falsify collision claims. Authorities said Mr. Rivas and Mr. Ingram would each receive a third of the claim settlement while the remaining third went to the fraudulent claimant. Many of the accidents allegedly never happened and were fabricated “for the purpose of defrauding insurance companies,” according to new Insurance Commissioner Dave Jones. Other claims were allegedly inflated by Mr. Rivas to get larger payouts.

The investigation began in September 2009 when Fraud Division detectives searched Mr. Rivas' home and found evidence of identity theft and auto insurance fraud. A search warrant was then used to get into Mr. Ingram's health care centers.

Three additional arrest warrants are still pending, the insurance department said. Mr. Rivas was in custody on unrelated charges. Each person has been charged with various felony offenses for insurance fraud and conspiracy.

Special Reports /

Auto Fraud Ring Busted In Los Angeles

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