In my publish about unlawful immigration, a commenter identified that I used to be fortunate to keep away from larger monetary penalties from my “car accident.” It seems that the maneuver the place a automobile accelerates from a cease after which abruptly slams on the brakes is a typical insurance coverage rip-off. This tactic is called the “sudden stop” or “brake check” scheme.
I began researching extra about such a fraud as a result of it had crossed my thoughts through the accident. Out of nowhere, after accelerating onerous, the automobile in entrance of me slammed on the brakes for no obvious purpose—she had the suitable of means on the intersection. Fortunately, I used to be transferring slowly, barely reaching 3 mph towards the cease signal, earlier than slamming on my brakes and bumping into her automobile.
Might Have Been A Setup
Later that night, a reader from San Francisco reached out, sharing the same expertise from simply the opposite month. What was outstanding was that it occurred on the similar intersection: the three-way junction of Sloat Blvd, Skyline Blvd, and Lake Merced Blvd.
And once they pulled over on the similar spot on Skyline Blvd, simply earlier than Zoo Highway, the opposite driver was additionally a lady who didn’t converse English. Conveniently, there simply so occurred to be a person on the aspect of the street who might translate for her. What are the possibilities?
That made me replay the small print of my very own encounter. It occurred at 2:57 pm on a Thursday, and the one different factor I remembered was seeing individuals in a automobile coming from Lake Merced Blvd who had been watching and laughing, as in the event that they knew it was a setup. How unusual, I keep in mind pondering.
Had been we victims of a staged car collision? I’m undecided since no cash was extracted from me or my insurance coverage firm. Perhaps once they pulled over, they anticipated to see harm to her outdated automobile. However on account of my reflexes, there wasn’t any, so they only determined to let issues go.
Sadly for the reader, there was harm to the entrance individual’s automobile. So she is within the means of coping with her insurance coverage firm now.
In case you are a frequent driver, beware that you possibly can be getting arrange for automobile insurance coverage fraud. When you don’t suppose automobile insurance coverage fraud impacts you, suppose once more. Billions of {dollars} are misplaced to fraud every year, driving up premiums for everybody.
I needed to do extra analysis!
Case Research on Automotive Insurance coverage Fraud
Under is the very first thing I discovered about automobile insurance coverage fraud from California’s Division of Insurance coverage. Los Angeles, which accounts for practically 43 p.c of all auto-related insurance coverage fraud in California.
On February 24, 2021, Zandra Monterrozo, 44, of Corona, pleaded responsible and was sentenced for her involvement in an organized ring that staged car collisions to gather over $135,000 in fraudulent insurance coverage payouts. Eleven different suspects, which included physique store house owners, had been additionally charged or prosecuted.
Checklist of 11 extra suspects:
- Bethuel Guevara Aguirre, 39
- Monica Elizabeth Sosa Alonzo, 39
- Baudilio Enrique Noguera, 49
- Juan Venancio Juarez Miranda, 49
- Carlos Enrique Lopez, 56
- Emma Amparo Lemus Martinez, 59
- Osmar Fernando Lopez, 40
- Alfonso Leon Baltazar, 51
- Mario Renee Alonzo, 67
- Marcos Farias, 70
- Walter Chacon, 31
Monterrozo was sentenced to at least one felony depend of insurance coverage fraud, ordered to pay $6,000 in restitution, and served one yr of probation. I am undecided what occurred to her different potential accomplices.
The rip-off entails one automobile deliberately braking shortly with out purpose, giving the driving force behind little time to react, inflicting a rear-end collision. The investigation revealed the ring was answerable for eight staged collisions involving harmless victims, and two collusive ones, leading to $137,832 in losses for victims and varied insurers.
Sounds loads like what each a reader and I skilled.
How the Brake Test Rip-off Works
Right here’s how scammers revenue from the brake verify scheme, typically with the assistance of a mechanic or clinic.
After forcing a collision, the scammer claims minor harm, like $1,000. They then enlist a shady mechanic who “finds” a further $5,000 value of harm. The mechanic payments the insurance coverage firm $6,000, and so they break up the additional $5,000 that was by no means spent on repairs.
Along with damages, scammers might declare medical points like whiplash or again ache to inflate their payout. With a number of passengers, every individual can file separate claims for “injuries,” doubtlessly incomes much more. Ideally, a fraudulent clinic is concerned, so the scammers can break up the insurance coverage funds from pretend medical remedies as nicely.
One other approach to extract cash from the sufferer is thru intimidation. After the accident, the scammers might demand money or valuables, with the translator abruptly turning into a threatening determine. If there’s little harm to the scammer’s automobile and so they consider the insurance coverage firm received’t pay out, the brake verify incident can escalate right into a mugging.
Purple Flags of a Staged Collision
When you suspect you are a sufferer of a staged collision, look out for these indicators:
- The opposite automobile is stuffed with passengers to extend the potential quantity for monetary payout.
- The driving force has a brand new insurance coverage coverage or no insurance coverage coverage.
- Their car is in poor situation or has a salvage title.
- Site visitors was flowing easily, however they stopped abruptly.
- The driving force and passengers all declare damage regardless of minimal harm.
- There are random witnesses who all occur to be of the identical background of the opposite driver.
Video of Brake Checking and Different Reckless Driving Habits in Motion
One widespread criticism I obtained from readers is that the accident was totally my fault since I rear-ended the automobile. I acknowledged that it might have been, even with the sudden braking, and had no downside exchanging ID and insurance coverage data.
Some readers mentioned I used to be out of line for asking for the opposite driver’s ID and insurance coverage. My dangerous. I assumed it was normal protocol, since that’s what you do when coping with the police or any visitors incident. I haven’t been in a automobile accident since faculty, and I favor understanding who I’m coping with after an accident.
Others blamed me for tailgating. I don’t find out about you, however after I’m at a cease signal or purple gentle, I usually depart about three ft of house—sufficient for somebody to comfortably stroll between the automobiles. Tailgating doesn’t appear as related when the automobiles are stationary. If a automobile abruptly accelerates and slams on the brakes, even from a standstill, it is onerous to react shortly sufficient.
Any such response is without doubt one of the causes automobile insurance coverage fraud via brake checking is such an efficient rip-off. If the driving force within the rear is all the time blamed, regardless of the circumstances, scammers are incentivized to make use of the brake verify scheme to money in.
For individuals who insist the entrance driver isn’t at fault, try this video that reveals quite a few examples proving in any other case. Earlier than leaping to conclusions, keep in mind there are all the time two sides to each state of affairs.
Is Defrauding Auto Insurance coverage Corporations Price It?
I am all for aspect hustles to make more money, however auto insurance coverage fraud would not appear to be return on effort. Take the case of Zandra Monterrozo. She collected $137,832 in fraudulent claims, but it surely took eight staged collisions with harmless victims and two collusive crashes to get there. Staging 10 collisions is numerous work!
Not solely is it time-consuming, however there’s additionally the chance that the insurance coverage firm won’t pay out. In the event that they don’t cowl not less than the car’s harm, you possibly can find yourself dropping cash. And it is unlikely that fraudulent claims have a 100% success charge, particularly when insurance coverage corporations are skilled at recognizing these scams.
One other draw back of insurance coverage fraud is having to share the earnings. Monterrozo needed to break up the $137,832 with 11 different individuals. That brings the common payout per individual to simply $11,488. Even when some took extra and others much less, it’s onerous to think about the ring chief strolling away with greater than half the entire quantity.
One other draw back is moving into an accident with the flawed sufferer. What if the individual would not keep calm like I did and as a substitute pulls out a knife or gun to retaliate? The sufferer might simply get pissed off as a result of they’ll suppose the accident was your fault. That’s a threat that doesn’t appear value taking.
Lastly, there’s the chance of getting caught. Monterrozo obtained a comparatively gentle sentence—$6,000 in restitution and one yr of probation. With such lenient penalties, it is easy to see why some scammers is perhaps tempted to strive once more.
Let’s Have Compassion For The Victims Of Insurance coverage Fraud Too
Whereas it is tempting for fraudsters to use the system, it isn’t a sustainable or risk-free approach to generate profits. For the common individual, collaborating in an organized scheme like this isn’t definitely worth the authorized and monetary penalties.
I perceive that determined occasions can result in determined measures. Empathy for perpetrators is a key precept for reformative justice advocates. In case you are poor or an unlawful immigrant with out many monetary choices, the temptation to partake in a automobile insurance coverage rip-off for a fast $500 is comprehensible.
Nonetheless, if we’re going to take a softer strategy to crime, we should additionally guarantee victims are compensated for the harm and struggling they endure too. Let’s not deal with criminals higher than law-abiding residents.
Suggestion For Drivers To Defend Themselves In opposition to Automotive Insurance coverage Fraud
Now that you just’re conscious of the brake verify scheme and different staged collisions used to rip-off insurance coverage corporations, listed below are some steps to guard your self:
- Set up a entrance and rear-facing digicam that constantly data when you drive. This supplies essential video proof in case you’re concerned in a staged collision. One advice my shut good friend makes use of is the Pulse P12 Professional 4K Mirror Sprint Cam. It prices about $200-$300 to put in.
- Drive a modest however protected automobile. Stagers typically goal high-value autos like industrial vehicles, luxurious automobiles, or government-owned autos, as these are virtually assured to have insurance coverage protection. Automotive insurance coverage fraud is one more reason why working towards Stealth Wealth is necessary. You turn out to be much less of a goal.
- All the time insist on a police report on the scene of the accident, and ask the officer to positively establish all events concerned.
- Completely doc the accident. Use your cellular phone to take photographs or movies of the collision, together with any harm to the autos.
- Report the suspicious collision to your state’s Division of Insurance coverage. They might have helpful data and assets to help you.
- Think about getting tinted home windows. Relying on the place you reside, you’re legally allowed to tint your home windows as much as a sure restrict. Think about going to that restrict. The darker your tint, the more durable it’s for others to see. This creates extra threat for fraudsters to select on you.
- Get the suitable insurance coverage insurance policies. Along with reviewing your auto insurance coverage coverage, it’s value contemplating an umbrella coverage for added legal responsibility safety. Converse along with your insurance coverage supplier not solely about automobile insurance coverage but additionally about scams just like the brake verify scheme. Ask for his or her suggestions on the suitable protection quantities for every sort of insurance coverage to make sure you’re totally protected.
No person Actually Cares, So You Should Be Vigilant
Accidents occur on a regular basis. Even for those who’re the sufferer of fraud, individuals will nonetheless discover a approach to blame you, typically exhibiting little sympathy to your state of affairs. And for those who admit the accident was totally your fault, individuals will bounce on the likelihood to tear you aside and take full benefit.
It’s a troublesome world on the market, people. Defend your self and keep protected!
Reader Questions
Have you ever ever been a sufferer of automobile insurance coverage fraud or another sort of insurance coverage fraud? If that’s the case, how did it occur, and the way a lot did the perpetrators get away with? When you work within the auto insurance coverage trade, I’d love to listen to your insights on automobile insurance coverage fraud. What’s the denial charge, and the way typically do insurance coverage corporations detect fraudulent claims?
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