28 felony counts in California crash-faking indictment

by Walter Olson on April 14, 2010

“For several years, [defendant Susana] Chung ‘acted as the conduit’ of fraudulent insurance claims filed in connection with staged crashes in Northern California, said Larry Blazer, an Alameda County assistant district attorney.” Nearly 100 persons, mostly “victims” of bogus accidents but also including three chiropractors, have been found guilty in the scheme. [San Francisco Chronicle, Oakland Tribune via ABA Journal]

{ 3 comments }

1 Anonymous Attorney 04.15.10 at 10:21 am

A time-honored scam, lovingly detailed in a book titled “Accidentally on Purpose” by Ken Dornstein. Dornstein worked as an investigator for insurance companies. He delves into the entire history of this, including the real origin of the term “loose lips sink ships” (in old England they would intentionally run rickety ships aground and make a claim with the underwriters).

http://www.amazon.com/Accidentally-Purpose-Personal-Underworld-America/dp/031217683X

From my time doing insurance defense work, I strongly suspected that this happened with a few of my cases, but I never had anything good enough to raise with anybody. A Hispanic plaintiff (before anyone starts screeching about racial stereotypes, please read Mr. Dornstein’s book) comes along with three separate low-speed rear-enders, all of which happen over a period of two years — and one accident occurs on the last day of the policy coverage for one of the “defendants”? And the most recent “defendant” is also Hispanic? Hmmm.

I’ll bet that if they looked into this in a few other places (Northern Virgnia, New Jersey?), they’d find what they found in California. But insurance companies are sometimes asleep at the wheel. Plaintiff’s attorneys aren’t obviously going to be much help. And law enforcement may not be fully aware of what’s going on. When I spoke to law enforcement in Virginia about the scam generally — and whether they’d encountered it — they had no idea what I was talking about.

2 Walter Olson 04.15.10 at 11:32 am

I also reviewed the Dornstein book here. I highly recommend it for anyone interested in this topic.

3 Kevin Hayslett 04.15.10 at 8:03 pm

Practicing on the West Coast of Florida we have seen the migration of this scam from the Dade county area. I concur that most law enforcement officers are either unaware or too busy to pick up the tell tale signs- 5 people injured in either an extremely low pact collision or from a vehicle that could only hold 2-3. I’m going to order the book.

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