Northern California authorities have unraveled an organized insurance fraud ring that allegedly spanned two states and bilked 13 insurers out of more than half a million dollars.
A joint investigation between the Contra Costa District Attorney's office and the California Department of Insurance (CDI) culminated in the arrest of five individuals, whom authorities believe helped carry out the ring's operations, which ran throughout northern California and northern Nevada and may have collected between $400,000 and $600,000 from various insurance companies.
In August 2011, the CDI began its investigation of a suspected organized crime ring and its leader, Louis Houston, 49, of Richmond, Calif., who remains at large. Investigators allege that Houston submitted at least 65 insurance claims; including property losses from ten separate fires, 20 incidents of theft or vandalism, eight automobile accidents, and six incidents of water damage.
“The egregious crimes allegedly committed by Houston and his partners contribute to higher costs for insurers and increased premiums for consumers,” said California Insurance Commissioner Dave Jones in a statement. “Our successful investigative partnership with the Contra Costa district attorney's office was essential to putting this ring out of business and bringing them to justice.”
After a year-long investigation, CDI investigators, in conjunction with the Contra Costa District Attorney's office, found that numerous items previously reported stolen or destroyed were actually in Houston's possession. A further search revealed evidence that Houston and his cohorts submitted fraudulent claims for personal injury, wage loss, and vehicle thefts. The suspects filed police reports and submitted documents to more than 13 insurers to support the array of fraudulent claims.
The suspects in custody were indicted on August 1, 2013 on 435 charges including insurance fraud, conspiracy, perjury and arson.
The CDI and Contra Costa County received investigative assistance from the California Highway Patrol, National Insurance Crime Bureau (NICB), Richmond Police Department, and Fresno Police Department. The following insurance carriers also assisted the investigation: GEICO, Allstate, Balboa, Homesite, Farmers, 21st Century, Travelers, RepWest, Nationwide, AAA, Assurant, Met Life and Safeco.
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