MEMPHIS, TN (WMC TV) - One person's fender-bender might be a scam artist's fraud.
Law enforcement and insurance company investigators call them "counterfeit crashes" -- staged accidents either by individuals or by teams (called "crash rings") designed to secure free medical care or to collect insurance checks.
"Crash rings often recruit immigrants, especially local and recent immigrants, who are hard up for money," said James Quiggle, director of communications for the Coalition Against Insurance Fraud (http://www.insurancefraud.org/), "(immigrants) who need the income to raise their families and can get easily paid a few hundred dollars in cash by acting as a set-up passenger in a staged accident."
Mid-South insurance investigators who asked not to be identified said there is a crash ring active in Memphis.
According to documents provided by the investigators on the condition Action News 5 would not release the names of the suspects, the ring has recruited hundreds of members. The ring-leader has the members park their cars at apartment complexes all over the city. The ring-leader rents U-Haul trucks/trailers, then purposely smashes them into the members' cars at each apartment complex.
He then files false insurance claims against U-Haul's insurance policy, and, in some cases, against the policies covering the members' cars. He collects the insurance checks, then distributes the cash throughout the ring.
Insurance agents and investigators said ultimately, the fraud results in higher insurance premiums for all consumers.
"They are stealing from you," said Margaret Fleming, fraud investigator for South Carolina Farm Bureau Insurance. "They are taking from your wallet (with) increases in premiums. It always increases the premiums because of insurance fraud."
"It gets passed on to honest drivers like you and me," added Quiggle.
According to the National Insurance Crime Bureau (https://www.nicb.org//), questionable insurance claims from staged accidents are up 46 percent nationwide between 2007 and 2009.
The NICB said in the Mid-South, staged accident claims are actually down 38 percent among the three states from 2007 to 2009. Tennessee alone has seen a 75 percent drop, thanks to aggressive policing and to savvy insurance company investigators.
Outside of crash rings, scammers use three basic techniques to snare innocent drivers into staged accidents.
* THE STOOP-N-SQUAT. On a roadway where passing vehicles are allowed, the scammer passes the victim's vehicle, merges in front, then slams on the brakes. Since the innocent motorist ran into the scam vehicle, the innocent motorist is considered at fault unless he/she can prove the fraud.
In the case of South Carolina's Dana Sanders, she was able to foil a 'stoop-n-squat' attempt on her vehicle by noticing existing damage on the scammer's car.
"When I got out of the car, I noticed his bumper was being held up by a rope," said Sanders. "Already had a whole lot of damage to it. I couldn't even tell what I had done because there was so much damage (already) there."
Insurance investigators said Sanders reported the existing damage to police. That enabled her insurance agent to deny the counterfeit claim.
* THE BULL-AND-COW. This is the same as the 'stoop-n-squat,' but it adds a second vehicle behind the innocent driver. The scam driver in front slams on the brakes, the victim slams into that vehicle, then the scam artist behind the victim slams into the victim's car. Both attempt to either fake injury or seek insurance restitution.
* THE T-BONE. At a four-way stop, the scam artist motions for the victim to drive through the intersection. As the victim moves into the intersection, the scammer accelerates to "t-bone" the victim's vehicle.
"They can get in there and hit you, and then claim that you've run the stop sign," said Allstate agent Maurice Stephens.
"Let them go on through if they're waving you out of a parking space or through an intersection," Quiggle said.
That's the first defense in avoiding one of these "counterfeit crashes:"
* OBNOXIOUS COURTESY. Let that driver go ahead of you at that 4-way stop, no matter who arrived first. Insist that they go through first, even if it seems ridiculous.
* DON'T TAILGATE. The experts say sophisticated crash rings will target drivers who are tailgating because they're more likely to rear-end somebody.
Quiggle said they also tend to target women or seniors. "Staged accidents often target women and seniors because they perceive that they're easily confused and they're very unreliable witnesses," he said.
Keep at least a car length, preferably two, between your vehicle and the car ahead of you.
* KEEP A CAMERA IN YOUR CAR. Or use your cell phone camera in case you are in an accident. Take pictures or video of the damage, especially damage that already existed on the other car. That could keep a crash ring from filing a false insurance claim.