“The Market Is Right” For An Increase In Insurance Fraud


Many Washington, D.C., area residents are torching their cars hoping for a quick insurance check, reports the Washington Post. Investigators estimate that hundreds of such crimes occurred in the area in the past two years, and experts predict the number will increase because of the worsening economy. Many offenders have fallen behind on payments to car dealerships. This year, more people are behind on loans than in nearly two decades. “With what’s just happened to the economy in the last week,” said Donald Galbreath, a fraud investigator for the insurance industry, “I see the trend will get worse.”

Data from a few insurance companies show that “potential owner give-ups,” most of which involve burned cars, increased from 511 in 2004 to 986 in 2007, according to the National Insurance Crime Bureau. The sample represents a “small percentage of the reality out there,” said Frank Scafidi, a spokesman for the anti-fraud group. Duane Svites, a Maryland deputy chief state fire marshal, said “the market is right” for insurance fraud. “A lot of people trying to dig themselves out of a jam,” he said.

Link: http://www.washingtonpost.com/wp-dyn/content/article/2008/10/12/AR2008101202255.html?hpid=topnews

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