Billion-Dollar ‘Fraud Tax’ Crime Syndicate Drives Up Rates

New York – Jan. 27…Staged car accidents and other auto insurance scams have become a “cottage industry” in states like New York and Florida, with organized criminal gangs and crooked medical facilities bilking hundreds of millions of dollars from insurance companies and hiking rates for innocent drivers. The problem is outlined in this television report released last night from CBS News.

Florida is advancing legislation to crack down on these scammers – who have murdered innocent victims preyed upon in staged accidents – but no progress has occurred in New York, where trial lawyers, who profit off auto accidents, have lobbied to prevent reform, the group New Yorkers Stand Against Auto Insurance Fraud (NYSAIF) today charged. Every single New York City District Attorney has asked for new laws to crack down on the dangerous and costly crime epidemic, which has cost New York drivers an estimated $1 billion in higher auto premiums over the past five years. But still, legislation to give law enforcement officers the tools they need to crack down on this crime wave remain holed up in committees, where they have sat for years.

NYSAIF is urging Governor Andrew Cuomo and New York lawmakers to immediately address the crisis to protect citizens from harm and to break up organized criminal enterprises that are growing larger each year. There is no law in New York State expressly forbidding staged auto accidents.

“Criminals are making a mockery of our laws in New York, people are getting hurt, and nothing is being done about it,” said former Kings County Assistant District Attorney and NYSAIF spokesman David Schwartz. “New Yorkers pay 53% more in auto insurance premiums on average than drivers in other states, largely because of staged accidents and other auto insurance scams. In some cases, civilians have been killed. It’s insanity. Something has got to get done this year.”

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