Investigators Use the Force — the Task Force — to Bust Alleged ‘Phantom Menace’ Fraud Ring

Copyright 2010 A.M. Best Company, Inc.All Rights Reserved BestWire

April 1, 2010 Thursday 04:03 PM EST

404 words

Investigators Use the Force -- the Task Force -- to Bust Alleged 'Phantom Menace' Fraud Ring

Sean P Carr

SACRAMENTO, Calif.

A multi-jurisdiction investigation featuring insurance and criminal investigators -- but no Jedi Knights -- resulted in a Los Angeles attorney being charged with 28 felony offenses for automobile insurance fraud. The investigation, dubbed "Phantom Menace," overturned an extensive fraud operation and has resulted in 94 people being convicted since it began in 2006.

Authorities alleged Susana Ragos Chung served as the conduit for fraudulent insurance claims stemming from staged accidents in Northern California. According to authorities, conspirators included a "capper" who recruited drivers and passengers willing to claim they were in accidents, an auto body shop willing to falsify repair records and medical providers willing to falsify medical records. Chung allegedly submitted the fraudulent claims to multiple insurance companies. Investigators determined Chung allegedly paid Norberto "Chito" Mora -- since convicted of being the capper and serving an eight-year sentence -- for the cases and then submitted claims on behalf of clients.

According to the state insurance department, most of the "accidents" were not documented by police reports. In some cases, collisions were staged -- often in the same locations -- while in others there were no collisions at all. In most instances, participants went to the same chiropractor, who was based far away from their homes. Of the handful of chiropractors used in these cases, three have been convicted of felony insurance fraud.

The total amount of insured losses has yet to be tallied, Assistant Alameda County District Attorney Larry Blazer said.

"Involving yourself in an intricate and illegal fraud ring in the hopes of making an extra buck is one of the worst decisions you can make," Insurance Commissioner Steve Poizner said in a statement.

The investigation by the Bay Area Auto Fraud Task Force included members of the Department of Insurance, the Alameda County District Attorney's Office and the California Highway Patrol. The Alameda County District Attorney's Office is prosecuting the case.

An attempt to reach the Law Offices of Susana Chung for comment was unsuccessful. A message on the firm's Web site reads, "We pride ourselves on our honesty, integrity, detailed knowledge and real-world application of the law. We minimize risk, maximize results and eliminate headaches for our clients."

(By Sean P. Carr, Washington Correspondent: [email protected])

April 2, 2010

Copyright © 2010 LexisNexis, a division of Reed Elsevier Inc. All Rights Reserved.
Terms and Conditions Privacy Policy