FRESNO- Following a California Department of Insurance-assisted investigation, on October 11, 2016, Victor Hugo Soriano-Villafan, 26, of Modesto, pleaded guilty in a federal court in Fresno, to conspiracy to commit mail fraud, admitting that he staged car accidents to defraud insurance companies.
“This case involved at least a half dozen individuals who conspired to stage vehicle accidents and submit claims with insurance companies," said California Statewide Law Enforcement Association (CSLEA) President Alan Barcelona. “This illegal activity contributes to the high cost of our premiums at a time when many hard-working families struggle to pay for vehicle insurance."
According to court documents, from at least October 2011 until August 2014, Soriano-Villafan conspired with at least six other people to stage dozens of car accidents and submit false claims seeking compensation for the damage caused by the staged accidents.
Commonly, Soriano-Villafan and his co-conspirators would also offer to repair the recruited individual’s vehicle at automobile repair shops that Soriano-Villafan or a co-defendant owned, usually with less-than-complete repair work, for a fee less than the payment from an insurance company. In all, Soriano-Villafan caused at least $750,000 in false insurance claims to be paid as a result of the conspiracy to defraud.
In each staged accident, Soriano-Villafan and other defendants utilized two or three vehicles and caused about $5,000 to $10,000 in damage to each vehicle. After each staged collision, the defendants submitted a similar cover story to an insurer that concealed the true cause of the accident. The cover story would commonly use aliases, false identities, and false addresses when describing the defendants. The defendants also commonly used different vehicles in the staged collisions. They were able to do this by obtaining many different vehicles and using false identities to both register the vehicles with the Department of Motor Vehicles and obtain insurance policies for the vehicles. The defendants operated in this manner to avoid scrutiny by an insurer that reviewed the false claims regarding a staged accident.
Soriano-Villafan and other defendants were able to repeat the scheme in dozens of crashes by recruiting other individuals to participate in the staged collisions. These individuals would allow their vehicles to be damaged and submit their own claim for damages. In many instances, false claims were submitted to the recruited individual’s insurance company.
Soriano-Villafan is scheduled to be sentenced on January 30, 2017. He faces a maximum statutory penalty of 20 years in prison and a $250,000 fine.
Charges are pending against co-defendants Juan Ortiz Rivas, 39, of Ceres; Liobigildo Vargas, 46, of Turlock; and Juan Marquez Cadenas, 30, of Patterson.
This case is the product of an investigation by U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) and the California Department of Insurance, Fraud Division.