California Jails Auto Fraud Ring Members

Three suspects have been arrested following an 11-month investigation by the California Department of Insurance of an auto insurance fraud ring that targeted car rental and insurance companies. From 2000 to early 2002, the suspects would rent vehicles, returning them a day or two later with slight damage. The renter would report that the damage resulted from a collision with a parked, unoccupied vehicle. Another person then would contact the rental company as the owner of the vehicle that had been struck, and submit a claim for property damages, the Fraud Division reported.

The same vehicles with the same damages were used over and over again in multiple claims, according to investigators. One of the vehicles, a 1997 Mercedes Benz SL600, was used in 10 claims, and various insurance companies paid more than $100,000 in settlements for alleged damages to the vehicle. The potential loss to the various car rental and insurance companies is estimated at nearly $500,000.