Body Shop Owner and Manager Arrested for Auto Insurance Fraud

Lemon Law Attorney Serving Los Angeles, Riverside, Ventura and San Bernardino Counties and Other Areas in California

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A body shop owner and the shop’s manager have been arrested for their role in a series of alleged car repair frauds in California. This article said that according to California insurance commissioner Steve Poizner, the two men arrested on July 1, 2009, were charged with multiple counts of auto insurance fraud. Both the 52-year-old owner and the 32-year-old manager were held on a $50,000 bail.

"Insurance fraud costs everyone money when it's passed on to consumers in the form of higher rates," says Poizner. "If you defraud an insurance company, the Department of Insurance will find you and help prosecute you."

The men were charged as a result of a California Department of Insurance Urban Auto Fraud Task Force investigation in conjunction with Farmers Insurance. The insurance company conducted inspections of repair work performed by two Choice Auto Body repair shops in Newark and Santa Clara. The 52-year-old defendant was the owner of both shops and the 32-year-old was the manager of the Santa Clara shop. After conducting 28 inspections of repairs the shops performed, the insurance company found that the shops had overbilled the company for repairs on 20 of the vehicles.

The two men allegedly repaired old parts but billed the insurance company for new parts or used parts of inferior quality in the repairs. The insurance company estimates that the alleged fraud cost them thousands of dollars. The car repair fraud case is currently being prosecuted by the Santa Clara District Attorney’s Office.

Although Farmers Insurance was the victim of the car repair fraud in this case, thousands of Californians are the victims of car repair fraud every year. Most victims of car repair fraud are unaware they have been victimized as this type of fraud can be easily hidden.

The single most common form of auto repair fraud is “parts switching.” Like some of the cases described above, parts switching involves charging a customer for new parts when replaced parts are either used or new, but of very poor quality. According to figures provided by the Center for Public Safety, auto body repair fraud alone costs Californians around $350 million each year. The California Bureau of Automotive Repair found in a 2003 study that around 40 percent of collision repair customers may become victims of repair fraud. The study also found that 42 percent of vehicles inspected after being repaired had an average of $800 in parts and labor on the invoice that were never installed or performed.

These are astonishing numbers and provide insight into just how pervasive auto repair fraud is in California alone. If you believe that you have been the victim of car repair fraud, you do have options. At the Law Offices of Howard D. Silver, we have helped many Californians go after the unscrupulous shops and repair people and hold them accountable for their deceit. Call 866.49.LEMON today and schedule a free consultation regarding your California auto repair fraud case.

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