Ten years ago in Lawrence, there was a car accident. It was like many other accidents in the city in that it was fake.
These accidents were staged events designed to create “victims” who would then go on to become the clients of unscrupulous lawyers and chiropractors. All of them — victims, doctors and lawyers — were milking the insurance companies for cash. The whole fraudulent enterprise was paid for by the hefty premiums assessed on the hapless drivers of Lawrence, the auto insurance fraud capital of Massachusetts.
But there was one aspect of this accident Sept. 4, 2003, that was real. There was a death. Altagracia Arias, a great-grandmother, died of a brain hemorrhage after the “bullet car” in which she was riding continued on after striking its target car and slammed into a utility pole.
The death of Arias was the turning point, the moment that those in a position to fight fraud — police, prosecutors, insurance investigators and politicians — decided that enough was enough.
Then police Chief John Romero, working with the Insurance Fraud Bureau of Massachusetts, assembled an auto insurance fraud task force that was so successful, it became a model for similar initiatives in other communities.
In the Lawrence area, the work of the task force resulted in nearly 500 arrests and fraud convictions against two lawyers and four chiropractors. It resulted in statewide legislation that made auto insurance fraud a felony and outlawed “runners”, those who were paid to recruit staged accident victims for the health and legal professionals.
Law-abiding Lawrence drivers have seen their auto insurance premiums drop as a result. The average premium in Lawrence for 2012 was $1,291, down from $1,678 in 2004, reporter Mark E. Vogler found. Drivers in the 13 cities with auto insurance task forces collectively have saved close to $1 billion in premiums over the last decade.
“Really, it’s unfortunate that it took somebody dying in a staged accident for this initiative to develop. But looking back 10 years ago, this was the catalyst that propelled us. And the results have been astounding. That cottage industry has been virtually eliminated,” Romero told Vogler.
Prior to the formation of the task force, auto insurance fraud had been difficult to fight because each individual incident was a relatively minor crime involving a small amount of money. It was also difficult to prove that a given accident had been faked or that claims of injury were phony.
The fraud task force applied old-fashioned police shoe-leather to the problem, going after the participants in the staged crashes and particularly targeting the runners. Once these lower-level participants were facing charges, they could be relied on to turn in those higher up the chain of fraud — the chiropractors and lawyers.
“Once we got the runners, we knew we could tie in the professionals — lawyers and chiropractors,” Lawrence Police Sgt. Michael Simard told Vogler. “Without the professionals, there would be no staged accidents. They’re the ones who fueled them. But without the runners, the professionals would have been untouched. It was easy catching the crash test dummies who sat in the cars. It was a little harder going up the chain of command.”
There’s a lesson here for dealing with other types of fraud that Americans know is happening under their noses but about which little seems to be done. With welfare benefits abuse and fraud, Medicare fraud and similar affronts to the taxpayers, the first step is deciding that enough is enough.