Family arson ring roasted for $4 million insurance fraud case
News: 2018 Press Release
SANTA CLARA, Calif. — Tyler Chen, 46, and his wife, Kim, 45, were arraigned in court yesterday in the Santa Clara County Superior Court following their arrest on multiple felony counts of insurance fraud and arson for their role in allegedly setting fires in a fraud scheme scamming five insurance companies out of $4 million. Four co-conspirators were also arrested and charged in the alleged fraud scheme.
"The complicated scheme these suspects allegedly devised to defraud insurers is deplorable," said Commissioner Jones. "Excellent investigative work by our detectives and insurance investigators led to unraveling this crime. We are committed to working with our law enforcement partners to bring justice to those who defraud Californians."
In January 2014, the department received a tip through its consumer hotline about a connection in a string of home, business and warehouse fires that occurred between December 2011 to September 2013. The tipster gave the exact address of where the next house fire would occur. The department launched a joint investigation with the San Jose Fire Department and the Santa Clara and San Joaquin County District Attorney's offices, which revealed two fires occurred at a business owned by the Chens and shortly after, their homes in San Jose and Stockton met a similar fate.
The residential fires were all reported to have started when chicken being fried was left unattended on the stove. The Chens allegedly orchestrated the entire situation to make it appear as though the fire was the result of a careless cooking incident and then planted many of the same smoke damaged items, which they had already claimed from other alleged fires in homes, warehouses and businesses.
Tyler Chen and his business associate, Ha Nguyen, 63, of Stockton, rented a number of warehouses for an import and export business they owned. According to investigators, the business partners used smoke-damaged belongings to also claim damage from fires in their warehouse or neighboring units. The investigation also found that goods claimed to be damaged in the fire had been purchased, but had not yet been received, which led detectives to arrest Nguyen for his role in the fraud scheme.
The Chens recruited a family member, a co-worker, and another local business owner to take part in the scheme even using the same smoke-damaged goods identified in the other fires. The damages claimed in all of the fires total $5,653,665 and $4,009,008 was paid out by five victim insurance companies. These co-conspirators, Trang Huynh, 34, of Stockton, Suong (Sandy) Ngo, 49, of Santa Clara, and Duyen Pham, 49, of San Jose, were arrested as well for their involvement.
The Santa Clara and San Joaquin County District Attorney's offices are prosecuting this case. The Chens, Trang Huynh, Suong (Sandy) Ngo, and Duyen Pham are scheduled to return to court on July 23, 2018. Ha Nguyen will be arraigned June 5, 2018.
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Media Notes:
- Full charges below:
| Name | Santa Clara County | San Joaquin County |
| Tyler Chen | 2x PC 451(b) Arson, inhabited | 3x PC 451(b) Arson, inhabited 3x PC 550(a)(1)-Ins. Fraud |
| Kim Chen | 1x PC 451(b) Arson, inhabited 1x PC 451(c) Arson, structure 2x PC 550(b)(1)-Ins. Fraud 2x PC 550(a)(1)-Ins. Fraud | 3x PC 451(b) Arson, inhabited 3x PC 550(a)(1)-Ins. Fraud |
| Ha Nguyen | 2x PC 451(b) Arson, inhabited 2x PC 451(c) Arson, structure 3x PC 550(b)(1)-Ins. Fraud 6x PC 550(a)(1)-Ins. Fraud 1x PC 548 - Destruction of Ins. Property (non-arson) | 3x PC 451(b) Arson, inhabited |
| Sandy Ngo | 2x PC 451(c) Arson, structure 1x PC 550(b)(1)-Ins. Fraud 3x PC 550(a)(1)-Ins. Fraud | - |
| Duyen Pham | 1x PC 451(b) Arson, inhabited 1x PC 550(a)(1)-Ins. Fraud | - |
| Trang Huynh | - | 1x PC 550(a)(1)-Ins. Fraud |
Led by Insurance Commissioner Ricardo Lara, the California Department of Insurance is the consumer protection agency for the nation's largest insurance marketplace and safeguards all of the state’s consumers by fairly regulating the insurance industry. Under the Commissioner’s direction, the Department uses its authority to protect Californians from insurance rates that are excessive, inadequate, or unfairly discriminatory, oversee insurer solvency to pay claims, set standards for agents and broker licensing, perform market conduct reviews of insurance companies, resolve consumer complaints, and investigate and prosecute insurance fraud. Consumers are urged to call 1-800-927-4357 with any questions or contact us at www.insurance.ca.gov via webform or online chat. Non-media inquiries should be directed to the Consumer Hotline at 800-927-4357. Teletypewriter (TTY), please dial 800-482-4833.
