Fraud Parties

​​​​​​​A complex auto insurance scam that involves multiple people is known as a fraud party. In this situation, an organized criminal group applies business principles to plan a highly sophisticated insurance fraud scheme. ​

​Who is Involved in Premeditated Fraud?

A criminal group that has ownership or an interest in multiple areas of the automotive supply chain can make fake claims and profit in areas such as: 

  • Recruitment. A recruiter sets up a staged collision and recruits people to participate as drivers or passengers.

  • Drivers and passengers. They submit reports to authorities and insurers about an alleged incident. As well, the drivers and passengers submit claims to insurers for alleged injuries and damages.
  • Auto businesses. A business owner purchases vehicles or salvage to be used in a staged collision.
  • Towing operations.  A tow-truck driver delivers a damaged vehicle to the scene of a staged accident and bills for storing or moving the vehicle to a collision reporting centre and/or body shop.
  • Auto repair facilities. A repair shop owner bills for repairs that were not completed, creates additional damage to increase repair charges and/or bills for unnecessary storage. 
  • Legal representative firms. A firm submits false documents to insurance companies.
  • Medical services. False billings for treatments, assessments and/or assistive devices are among the activities related to medical services fraud.
  • Employers. An employer confirms false employment​ to support claims for lost income.
  • Service providers. This area includes claims for services – such as housekeeping, care of dependents and personal care – that have not been provided.

Additional Resources