Consider this: you’re stuck in traffic on a busy highway. Another car cuts off the driver in front of you, forcing him to slam on the brakes. You try to stop, but there’s no time – and you rear-end the person right in front of you. This may sound like an ordinary accident – you were in the wrong place, at the wrong time… right? Not this time. Turns out you’ve been set up by an organized criminal ring that staged the entire event.
How the Scam Works:
The method described above is known as the “swoop and squat.” The first car “swoops” in, while the second car “squats” in front of you. After the “accident,” everyone in the car you rear-ended will file fraudulent injury claims with your insurance company. They’ll typically complain of injuries that are difficult for doctors to verify, such as whiplash or soft-tissue injuries. It’s common for the scam artists to work with unethical professionals (doctors, lawyers, auto repair technicians, etc.) to further exaggerate their claims.
Similar Scams to be Aware of:
- The Drive Down: You’re trying to merge when another driver motions you to go ahead. Instead of letting you in, he slams into your car, and later denies that he ever waved you forward.
- The Sideswipe: As you turn a corner at an intersection with multiple turn lanes, you drift slightly into the lane next to you. The car in that lane steps on the gas and sideswipes you.
- The T-Bone: You’re crossing an intersection when a car coming from a side street rapidly accelerates and hits your car. When the police arrive, the driver and several planted “witnesses” claim that you ran a red light or stop sign.
There are many more unscrupulous auto accident fraud scams, some more organized than others. The FBI reports that staged accidents cost the insurance industry approximately $20 billion a year. Those costs are passed on to all of us, in the form of higher insurance rates (an average of $100 to $300 extra per car, per year). However, what stays consistent is how potential victims must defend themselves against this type of fraud.
How to Protect Yourself
- If you’re involved in an accident, call the police immediately.
- Report accident claims to your insurance agent immediately – Never settle on-site with cash.
- Be wary of how you dispense your personal information – keep identity theft in mind.
- If possible, take photos of the car and its passengers, and write down names, addresses, and phone numbers.
- Only use car repair, medical, and legal professionals whom you know and trust.
- Practice defensive driving – don’t tailgate!
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