The police chief of Hackensack, NJ was recently striped of his 15 year position after being charged with insurance fraud–he filed a false insurance report. An upstate New York man was recently also charged with the same crime: all he did (!) was take out an automobile insurance policy AFTER the date of his car accident and then made a claim under the policy changing the date of the accident so that the policy would cover it.

People in all walks of life, for a variety of reasons, but virtually always grounded in the desire to reap rewards to which they are not legally entitled, participate in what is almost a national pastime: insurance fraud. There are numerous forms that insurance fraud takes, but perhaps the most insidious is the scheme involving staged accidents. (See the instructive video: ).

The staged accident phenomena is becoming more prevalent. It involves claims under a state’s no-fault provisions relating to medical costs, where medical providers of all sorts have been found to participate in these schemes.

It also involves claims for bodily injury that find their way into court cases, reaping enrichment for unscrupulous lawyers and thieves acting as clients. The two states with the highest rates of staged accident fraud are, in order, Florida and New York..

While the claim may be that “only” insurance companies are hurt, in reality it is everyone that owns a car that is hurt. Fraud has a significant effect on insurance premiums, which affects every car owner in his or her pocketbook.  And make no mistake about it, engaging in any type of insurance fraud changes what would normally be a civil matter involving claims for money damages, into a criminal matter, where the penalties faced by those engaging in this nefarious practice will include incarceration!