Grants of $23 million given to California DA’s to battle auto insurance fraud


Grants of $23 million given to California DA's to battle auto insurance fraudGrants of about $23 Million would be given to the District Attorney’s offices in and around the state of California to battle auto insurance fraud. Maria Ramirez who heads the division has stated that their department has literally been ‘operating on fumes’ due to the scaled-down budgets as well as the rise in crime. She has a tough job fighting insurance fraud in one of the most populous counties in the state. This announcement seems to have brought in a lot of cheer to her department.

Insurance Commissioner, Dave Jones had announced funds, which totaled to $15.2 million and this would have to be distributed to 35 counties as part of a regular grant for auto insurance fraud. Ten counties then received $7.6 million for their organized auto insurance fraud program. The funds would be used by DA’s to investigate and prosecute auto insurance fraud.

These funds are distributed to all DA’s by the Insurance Commissioner in recognition of the participation in the investigation and prosecution of auto insurance fraud. The Insurance Commissioner in the state is granted statutory authority and allows collection of assessment from the auto insurance carriers, based on the number of vehicles they insure. The Insurance Commissioner then distributes these funds to the DA’s.

The biggest recipient of the grants was the Los Angeles County’s Auto Insurance Fraud Division, which received around $7 million. L.A. County is leading in suspected fraudulent auto insurance claims.

Ramirez also explains the difficulty they faced as they were unable to pay salaries to their investigating team who worked on auto insurance fraud. They faced a lot of problems due to this, she added.

There are 12 attorneys and roughly around 20 investigators in the division, who are in different sections such as the regular fraud section as well as the organized fraud sections.

Ramirez states that if these grants were not given, they would have not been able to dedicate an entire section to prosecution and investigation of insurance fraud.

There has been a sharp rise in auto insurance fraud, ever since the economic meltdown in the US. LA County has seen the worst especially in 2008, stated Ramirez. In fact, the number of false claims that were made during this period had also increased sharply, she added.

Actually, much more resources are required to battle the auto insurance fraud, as the organized ring has chiropractors, lawyers, medical professional and the ones that organize the crime.