Aug. 31--With the tough economy pushing more people to commit insurance fraud in the Inland area, the Riverside County district attorney's office on Thursday, Aug. 30 announced $2.4 million in state grants to help staff the insurance fraud unit of the special prosecutions section.
The grants were announced at a news conference in Riverside by District Attorney Paul Zellerbach and California Insurance Commissioner Dave Jones.
The money for 2013 will cover investigations into workers' compensation insurance fraud; what is called "regular" automobile insurance fraud by individuals; and also organized auto insurance fraud that is conducted by a ring that conspires to stage accidents and collect and divide the profits among its members.
The majority of the money, $1.4 million, is aimed at workers' compensation fraud.
"Unfortunately in these tough economic times we've seen a rise, an increase, in automobile insurance fraud (and) workers' compensation fraud, we also have what we call life and annuity fraud, and that type of fraud is on the upswing as well, so we have our work cut out for us," Zellerbach said in announcing the grant.
Zellerbach said that in 2010, Riverside County ranked third in the state for suspected fraudulent claims involving auto insurance.
The grant money will cover the salaries and benefits for five prosecutors, seven investigators, one paralegal and one investigative technician, Zellerbach's office said.
Prosecutors recounted some recent cases in Riverside County: Three workers compensation swindle cases had assessed frauds at $3.1 million, $769,000, and $2.1 million; a fabricated auto insurance theft report resulted in a one-year jail sentence and insurance restitution of $17,613, and a false motorcycle theft report that ended with $23,395 in restitution to the insurer.
The losses are not just to insurers and the state, Jones said.
"Workers' compensation insurance fraud drives up the cost of workers' compensation insurance and hurts honest businesses in our economy," Jones said in a statement. "Auto insurance fraud drives up the price of auto insurance for consumers."
Jones said the grant comes from the insurers. He said the state Legislature years ago authorized a series of grant programs funded by assessments on insurance companies. The grant distribution is overseen by his agency, which issues the money after reviewing applications.
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