News: 2010 Press Release
For Release: April 1, 2010
Media Calls Only: 916-492-3566
Commissioner Poizner Announces La-Based Attorney Surrenders After Being Charged With 28 Felony Counts In Alleged Complex Organized Auto Fraud Ring
Insurance Commissioner Steve Poizner announced today that a Los Angeles attorney surrendered following automobile insurance fraud charges in Alameda County. Susana Ragos Chung, 59, was charged with 28 felony offenses following an investigation known as "Phantom Menace," which was conducted jointly by the Bay Area Auto Fraud Taskforce. The task force is comprised of members from the Department of Insurance, Alameda County District Attorney's Office and the California Highway Patrol.
"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," said Commissioner Poizner. "No matter how organized or coordinated your fraud operation is, Department of Insurance investigators, CHP and District Attorneys will work tirelessly to catch you and put you behind bars."
It is alleged that Chung acted as the conduit of fraudulent insurance claims associated with a large number of staged accidents in Northern California. The fraud ring included a "capper" who orchestrated the fake accidents by recruiting drivers and passengers willing to say they were in the "accidents," the auto body shop willing to falsify repair records and the medical providers willing to falsify medical records. The capper, Norberto "Chito" Mora, is currently serving an 8 year prison sentence for his role in the fraud ring.
Once the recruitment and information gathering was complete, Chung allegedly submitted the fraudulent insurance claims to multiple companies. Investigators determined that Chung allegedly paid Mora for the cases and then submitted claims on behalf of clients.
Most of the purported "accidents" were not documented in police reports. Investigators determined that some collisions were staged, while other vehicles had claims filed after no collision had taken place at all. Many of the "accidents" were said to have occurred at the same locations, and were said to have involved multiple passengers. Most of the "accidents" led to all participants going to the same chiropractor, not their regular doctor, far away from their homes. There were only a handful of chiropractors repeatedly used in Mora's cases, three of whom have since been convicted of felony insurance fraud.
The Alameda County District Attorney's Office is prosecuting this case. Since the investigation began in 2006, the District Attorney's Office has obtained 94 convictions of individual defendants involved in this ring, including 63 felony convictions.
Commissioner Poizner oversees sixteen CDI Enforcement Branch regional offices throughout the state. Nearly 2,800 insurance fraud-related arrests have been made by CDI since Commissioner Poizner took office in 2007 - more arrests than have been made during any other three year period, under any previous insurance commissioner.
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