Twenty-Two Suspects Charged With Auto Insurance Fraud

​For release on December 4, 2017 

CONTACT:
Charlotte Chang, Deputy District Attorney
Insurance Fraud Unit
(408) 792-2974

 

TWENTY-TWO SUSPECTS CHARGED WITH AUTO INSURANCE FRAUD

Nineteen Santa Clara County residents have been charged with operating a fraud ring which faked numerous car accidents. Three additional suspects from Butte and San Benito Counties have also been charged.

The fictional accidents - which were often reported as caused by a distracted driver striking parked vehicles – generated almost a quarter of a million dollars in fraudulently obtained insurance payouts.

Some of the defendants will be arraigned in the South County Court in Morgan Hill this week on insurance fraud charges. They face incarceration and will be required to pay restitution to the victim insurance companies, if convicted.

Prosecutor Charlotte Chang said: “When false claims are paid out by insurance, losses are passed along to consumers who pay hard-earned premiums to cover real accidents.”

Between 2012 and 2015, the ring staged 18 different accidents. The highest single claim was $37,723. Some of the cars and two San Jose auto shops – Espinosa Body Shop and Auto Parts USA – were used repeatedly in the scams. 

One of the false claims tipped off a Farmers Insurance investigator when the damage on one of the cars did not match the reported details of the loss. The investigator then discovered that the son of one of the suspects had also been involved in an identical alleged accident two months before. Both phantom accidents involved the same auto shop – Espinosa Body Shop.  The case was referred to the Silicon Valley Auto Insurance Task Force.  The lead investigators from the District Attorney’s Office then uncovered a pattern of scams with this ring after noticing that numerous auto crash claims involved the same vehicles/suspects and insurance policies that were bought shortly before the alleged “accidents”.

The owner of Espinosa Body Shop is being prosecuted by the Santa Clara County District Attorney’s Office in a similar insurance fraud ring case involving 15 false claims filed by Gerardo Ivan Espinosa Martinez as the ringleader, and 17 of his associates, including his wife.   

Over the last two years, the Santa Clara County District Attorney’s Office has prosecuted four different organized insurance fraud rings totaling 82 defendants.  Altogether, these groups siphoned more than $1 million from insurance companies for accidents that never happened.  All of these cases were investigated by the Silicon Valley Auto Insurance Fraud Task Force, comprised of investigators from the Santa Clara County District Attorney’s Office, California Highway Patrol, and California Department of Insurance – and aided by National Insurance Crime Bureau (NICB), an allied agency.

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