This is the third of a four-part series titled Nightmare Scenario Car Accidents & What You Should Do. Here, we look at vehicle accidents that are part of scams orchestrated by criminals. Most citizens are honest and hardworking members of society; however, there is a criminal element that seeks to take advantage of aspects of auto accidents and insurance. Actions classified as fraud, such as the auto accident scams we will discuss, are among the most common financially-based crimes in the country.
Organized Criminal Activity
Certain regions of the United States have particularly high rates of such activity. In Colorado in 2010, 12 people were indicted for staging car accidents and auto insurance fraud. A group of Russian immigrants in New York City conducted a crime ring responsible for over $270 million in losses relating to fraudulent accident injuries. California has also been home to high volumes of these types of scams in recent years. The National Crime Bureau reported that insurance providers have seen considerable increases in cases of suspected fraud.
Phone-based Accident Scam
A Colorado Springs man received a call explaining that there was a bad accident. His wife had actually gone to the region where the caller claimed the accident had occurred. The caller proceeded to explain that his own brother was also involved in the crash and was holding the man's wife hostage in exchange for money. The man became very suspicious and immediately contacted the authorities who confirmed it was a scam. Similar calls occurred across the Pikes Peak area and the El Paso County Sheriff's Office has since issued public warnings.
Two-Car Staged Accidents
In this staged accident, a car suddenly moves in front of yours and abruptly puts on the brakes. At the same time, another vehicle emerges next to yours, which prevents you from swerving to potentially avoid the collision. You strike the vehicle ahead and are likely deemed at fault for the accident based on failing to allow adequate braking distance. In this instance, you may initially be ticketed and need to correct the matter later.
PIP Insurance Scams
An old car with multiple passengers pulls in front of you and abruptly applies the brakes. Regardless of whether you avoid the car in front, another vehicle from the rear with passengers strikes you causing a three-vehicle accident. The vehicle occupants exit the vehicles complaining of significant injuries. This scam is most likely to occur in states with “no-fault” auto insurance such as Florida or New York. Those “injured” in the accident are able to seek costly medical care from a chiropractor or walk-in clinic using their PIP insurance coverage. This “swoop and squat” scheme is one reason that Colorado abandoned the “no-fault” system of auto insurance in 2003.
Other Common Scams
- Drive down: The victim is awaiting a left turn and is lured into proceeding when a driver accelerates to cause a collision.
- Wave down: One vehicle motions the victim who is backing out of a parking space to go; however, a second car is there causing a collision.
- Inflated damages: An accident occurs legitimately, yet the driver who is not at fault causes additional damage to the vehicle or claims that existing damage was from this collision.
- Invisible victims: After an accident, an “injured passenger” emerges making false claims as if he was in the vehicle at the time.
What to Do: Best Practices
There are several things that you can do to reduce the chances that those executing the scam can get away with it. After a collision, use your mobile phone camera to clearly document the scene and all damages that occurred to the vehicles. Always contact the police if there is any mention of a potential injury after a motor vehicle collision. When law enforcement arrives, alert them to your suspicions regarding the accident. Proactively inform your insurance provider if you suspect an incident involving fraud. Contacting an experienced accident injury attorney may also be beneficial to you in these situations.