Posted on Insurance Law Blog / Blog / Fraudulent California Auto Claims | Special Investigations Unit Blacklisted Attorneys

Page Updated 12/08/2021

Fraudulent California Auto Claims | Special Investigations Unit Blacklisted Attorneys


Understanding What Insurance Fraud Is All About

Insurance fraud occurs when someone deliberately makes a falsified claim to obtain a benefit or advantage to which they are not otherwise entitled, or someone deliberately denies a claim that is due to another entitled party.

The California Department of Insurance (CDI) handles referrals on suspected insurance fraud and they never take such cases lightly. They can charge and prosecute any criminal in a felony case.

The punishment for committing insurance fraud includes probation, fines, community service, restitution, confinement in county jail, and state prison.

In a case when defense attorneys liaise with their clients to make false insurance claims against insurance companies, such an attorney gets blacklisted by the insurance company.

They can do that, especially after the involvement of the special investigation unit, and when there is enough evidence to back up the fraudulent act of such an attorney.

For example, in a memo by one nation’s largest auto and homeowner insurer, State Farm, a State Farm manager instructs employees not to settle claims with the listed attorneys but instead refer their cases to a special new fraud unit for further investigation.

Work with Our Attorneys to Beat Insurance Companies

  • Penal Code 550 PC Fraudulent Claims
  • Prosecution for Insurance Fraud
  • How to Stay Away from Insurance Fraud

Insurance companies usually have a dedicated team of experienced defense attorneys in a Special Investigation Unit (SIU).

They have previously served in law enforcement for many years, utilizing their experience, knowledge, and techniques in helping to fight fraud for their clients successfully.

They personally involve themselves in investigating in the direction of their clients’ any questionable claims successfully. You, however, have Ehline Law on your side.

Penal Code 550 PC Fraudulent Claims

California Penal Code 550 PC covers several different forms of California car insurance fraud.

One of these is Penal Code 550(a)(4), presenting a false or fraudulent claim for theft, destruction, damage, or conversion of a motor vehicle.

The legal definition of this form of auto insurance fraud is:

  1. You falsely or fraudulently claimed payment for a loss due to theft, destruction, damage, or conversion of a motor vehicle, a motor vehicle part, or the contents of a motor vehicle;
  2. You knew that the claim was false or fraudulent; and
  3. When you submitted the claim, you intended to defraud.

Prosecution for Insurance Fraud

According to the law, the crime of insurance fraud can get prosecuted when:

  • The suspect intentionally committed the fraud. Insurance fraud is a crime with “specific” intent. This implies that the prosecutor must establish, with enough evidence, that that the defendant deliberately acted fraudulently. 
  • The suspect completed a fraudulent act. Simply proving that the defendant makes a misrepresentation (written or oral) to an insurer with a piece of false information is sufficient evidence.
  • The suspect’s act and intent come together to accomplish the act. It is not a crime when there is one without the other.

In California, under Penal Code Sections 548-551, “auto insurance fraud” is an unlawful activity that involves automobile insurance. Auto insurance fraud often occurs when a person:

  • Intentionally destroys, conceals, damages, or abandons their car in order to gain from the filing of an auto insurance claim;
  • Makes a fake auto insurance claim for a loss caused by vehicle damage, destruction, or theft with the intent of obtaining insurance funds;
  • Makes two or more vehicle insurance claims for the exact same loss with the intent of profiting illegally from the profits;
  • Plans, deliberately cause, or participates in a car accident solely for the purpose of profiting from the proceeds of the car insurance claim;
  • Knowingly presents or prepares any written or oral statement as part of a false insurance claim or investigation that is false;
  • Hires an employee or compels an employee to refer, trade, solicit, or take business, with the intent of committing auto insurance fraud;
  • Lies that they are a resident of the state of California on an application for car insurance to profit from the proceeds.
  • Owns or is an employee of an automobile repair shop that offers insurance agents or adjusters a commission or profit-sharing arrangement (a “kickback”) to refer policyholders to their shop.

Established in 1979, the Fraud Division is the law enforcement unit within the California Department of Insurance and is made up of four separate insurance fraud programs:

  • Automobile Insurance Fraud
  • Workers’ Compensation Fraud
  • Property, Life and Casualty Fraud (property, health, arson, life insurance fraud, and disaster relief)
  • Disability and Healthcare Fraud

The Fraud Division Detectives get recognized as the industry’s foremost authorities in insurance fraud.

They have criminal investigative training and give help and training to customers, insurance businesses, law enforcement agencies, and the public/private sector.

How to Stay Away from Insurance Fraud

Prosecutors in California thoroughly investigate and prosecute auto insurance fraud cases for a few reasons:

  • Car insurance fraud is a huge problem, in America and is a grim crime.
  • Some industry groups report an estimate of least 10% of property/casualty auto insurance claims are fraudulent. For example, The LA County District Attorney’s office has a separate Automobile Insurance Fraud Division for handling auto insurance fraud cases.
  • Insurance companies have political power and are interested in cracking down on auto insurance fraud, according to the penal code. In California, the Department of Insurance works closely with local prosecutors to see that the courts aggressively deal with suspected fraud.

If you get charged with California insurance fraud, you and your criminal defense attorney may want to consider the following legal defenses:

You Did Not Act with Fraudulent Intent

Every auto insurance fraud needs evidence of specific intent.

Many times, your auto insurance company may flag a careless mistake on your part as potential fraud and they may report it to the authorities.

Nonetheless, the burden is on the prosecutor, as they must prove beyond a reasonable doubt, that you intended to commit fraud and that the act was not a simple mistake.

If you have a strong attorney-client relationship with an aggressive and skilled defense attorney from Ehline Law Firm, you may be able to cast enough doubt on their assertions and they will have to drop all charges or give a not-guilty verdict in a jury trial.

There Is Insufficient Evidence That You Committed Auto Insurance Fraud

Many auto insurance fraud cases become complicated because of the set of facts they base them around. It can be challenging to sort out sufficient evidence beyond a reasonable doubt of what really happened—particularly if there are visible convoluted paper trails, circumstantial evidence, or conflicting testimony involved.

An expert Los Angeles criminal defense attorney will find every ambiguity in the prosecutor’s case and help you collect the strongest evidence to prove your innocence.

Call the Ehline Law Firm at (213) 596-9642 to see what our Los Angeles personal injury attorneys can do for you.

Ehline Law Firm - Personal Injury Attorneys, APLC
Attorney at Law
Michael P. Ehline Esq,
Downtown Los Angeles Corporate Offices

Downtown Los Angeles Office
633 West 5th Street #2890
Los Angeles, CA 90071
Navigation

Ehline Law Firm - Personal Injury Attorneys, APLC
Attorney at Law

Michael P. Ehline Esq,

Other Los Angeles County Meeting Places
Long Beach Office

5001 Airport Plaza Dr Ste 210
Long Beach, CA 90815
(562) 731-0668
Directions

West Hollywood Office

8752 Holloway Drive Ste 304
West Hollywood, CA 90069
(424) 666-3944
Directions

Santa Monica Office

201 Wilshire Blvd. Fl 2
Santa Monica, CA 90404
(310) 237-6218
Directions

Torrance/Hermosa Beach Office

3961 CA-1
Torrance, CA 90505
(424) 999-7246
Directions

Marina Del Rey Office

4640 Admiralty Way Ste 500
Marina del Rey, CA 90292
(310) 331-8775
Directions

Beverly Hills Office

509 S Beverly Dr
Beverly Hills, CA 90212
(424) 666-3967
Directions

Glendale Office

655 N Central Avenue
Glendale, CA 91203
(818) 485-2311
Directions

Inland Empire Meeting Places

Rancho Cucamonga Office

8333 Foothill Blvd #200
Rancho Cucamonga, CA 91730
(909) 963-0709
Directions

Riverside Office

11801 Pierce St, Ste 200
Riverside, CA 92505
(951) 777-2877
Directions

San Bernardino Office

198 North Arrowhead Ave. #20
San Bernardino, CA 92408
(909) 693-5417
Directions

Orange County Meeting Places

Costa Mesa Office

600 Anton Boulevard #11
Costa Mesa, CA 92626
(949) 891-0357
Directions

Laguna Niguel Office

23046 Avenida de la Carlota, Ste 600
Laguna Beach, CA 92651
(949) 371-8350
Directions

Irvine Office

9180 Irvine Center Drive
Irvine, CA 92612
(949) 207-7193
Directions

Newport Beach Office

5160 Birch St #110
Newport Beach, CA 92660
(949) 891-0127
Directions

Orange Office

333 City Blvd. #17
Orange, CA 92868
714-912-9724
Directions

Other California Meeting Places

Rancho Cucamonga Office

1999 S Bascom Ave, Ste 700
Campbell, CA 95008
(408) 940-3996
Directions

San Francisco Office

50 Francisco Street #460
San Francisco, CA 94133
(415) 684-7688
Directions

Carlsbad Office

1902 Wright Pl, Ste 200
Carlsbad, CA 95008
(760) 517-9022
Directions

Ehline Law Firm - Personal Injury Attorneys, APLC
© 2021 All rights reserved.
Ehline Law Firm Personal Injury Attorneys, APLC