EagleTribune.com, North Andover, MA

May 1, 2013

Editorial: Fraud crackdown continues to pay dividends

The Eagle-Tribune

---- — There are few better examples of how good police work can improve a community than the results of a 10-year crackdown on auto insurance fraud in Lawrence.

Thanks to the work of a task force assembled by Lawrence police and the Insurance Fraud Bureau of Massachusetts, drivers in Lawrence have saved more than $68 million in auto insurance premiums since 2003. The average cost of insuring a vehicle in the city has declined from $1,613 in 2003 to $1,260 in 2011.

While the latter figure is still high, it is a substantial savings over the former rate. That’s real money staying in people’s pockets.

Lawrence was once the auto insurance fraud capital of the state, if not the nation. Fraud was an industry here supporting lawyers, chiropractors, physical therapists, the “runners” who brought them the new cases and, of course, the individuals who staged the phony accidents.

That all changed in September 2003, when great-grandmother Altagracia Arias was killed in a staged accident she helped plan.

The Eagle-Tribune reported at the time that, just hours before her death, Arias had offered several people at the Lawrence Senior Center seats in the car that was to be crashed. The price for a seat was $200 cash.

The crash at the corner of Ferry and East Haverhill streets was more intense than planned and Arias was killed.

Prior to that accident, these kinds of claims were routinely paid off and the high cost of doing business in Lawrence was recouped through higher insurance premiums for city residents.

But the death of Arias prompted police Chief John Romero to assign a number of his detectives to work with insurance investigators to crack down on phony accidents and fraudulent claims. Some 484 individuals were criminally charged and a number were convicted. The state passed an “anti-runner” law that made it a crime for lawyers and health-care providers to pay individuals to bring them clients.

As a result, the number of people reporting injuries per accident — a statistical indicator for fraud — dropped dramatically in Lawrence from 141 injuries per 100 accidents prior to 2003 to 49.4 per 100 accidents in 2011.

The task force model established in Lawrence has spread across the state to other communities where fraud was endemic. Collectively, the task forces in a dozen communities have saved drivers $875 million since they were initiated, according to a recent report issued jointly by the fraud bureau and the Automobile Insurers Bureau of Massachusetts. Criminal charges have been filed against 1,917 people.

“Clearly, this ... effort has been a major contributor to a healthy auto insurance climate in Massachusetts over the past decade,” the report said.

This effort shows that controlling what might have once been considered a “nuisance” crime can have far reaching effects on the quality of life in a community. Ridiculously high insurance premiums were once taken for granted in Lawrence. Now, thanks to the work of Lawrence police, county prosecutors and industry investigators, premiums are more manageable.

Ten years after it began, the crackdown on auto insurance fraud continues to pay dividends for the driving public. That’s good work by all involved. Let’s keep the pressure on.