SAN JOSE – A major insurance scam ring was busted July 16, 2015 when 33 suspects, most of them from San Jose, were charged with felony insurance fraud.  The suspects are accused of intentionally crashing older cars into each other and collecting  insurance money. The staged collision scam resulted in insurance pay outs of about $500,000.

 A very alert CHP investigator started to notice a pattern of drivers claiming they had accidentally spilled coffee on themselves, which caused them to lose control of their cars and crash.  Hence a three year, multi-agency investigation dubbed  “Coffee Break.”

“It’s unfortunate there is so much of this going on in California,” said California Statewide Law Enforcement Association (CSLEA) President Alan Barcelona.  “Our CSLEA members who are California Department of Insurance detectives are inundated with investigations.  They have proven, time after time, their cases result in arrests, charges, prosecution and sentencing.”

“California is ground zero for staged auto collisions, which costs the insurance industry billions in losses every year,” Insurance Commissioner Dave Jones said.  “Consumers pay for these crimes when insurers pass along the losses.”

The  investigation revealed multiple crash claims from 2010 to 2012.  Most of the claims were in Santa Clara County.  The  suspects often purchased insurance policies shortly before the alleged accidents. A number of suspects filed multiple claims using different fictitious names or aliases.  The suspects are accused of purchasing an auctioned or salvaged vehicle, or recruiting someone with a car on which they were making payments. The suspect would intentionally crash the car into one to two other vehicles, owned by co-conspirators. The owners of the vehicles would contact the insurance company and claim the loss. In most cases, the vehicles were written off as totaled by the insurance companies. They would pay the owners or lienholders the full value of their cars. Some of the vehicles were used in the scheme numerous times, getting wrecked, repaired and wrecked again.

The 33 charged all face prison time if convicted.  On July 16th, 14 of the 33 charged were in custody.

The suspects in custody are identified as:

Sergio Diaz Landa, 46, of Stockton

Jorge Salazar,  53 of San Jose

Vicent Dominguez Ojeda,  32, of San Jose

Jose Santos Salzar,  52,  of San Jose

Ramon Lujano Arreguin,  63, of San Jose

Oscar Diaz Landa,  45, of  San Jose

Maria Barragan Corral,   34, Gilroy

Irma Rodriguez, 34, of San Jose

Eduardo Ayon,  37, of San Jose

Oscar Escobar,   37, of San Jose

Rodolfo Guillen Alvizar, 31, Unknown residence               

Santos Escobar Alvarado,  35 of Redwood City

Beatriz Chavez, 34, of San Jose

Rene Partida Delgadillo, 45, of San Jose

This case was investigated by the Organized Auto Insurance Fraud Task Force with detectives from the California Department of Insurance, California Highway Patrol, and the Santa Clara County District Attorney’s Office.