DA: Large car insurance fraud ring disrupted
GREENFIELD — Dozens of New York City area residents have been charged locally with defrauding car insurance companies of hundreds of thousands of dollars, by claiming to live in the Pioneer Valley to get cheaper premiums.
Hampshire and Franklin county grand juries have returned indictments against 38 individuals, alleging they were involved in the insurance fraud ring operating both locally and in the metropolitan New York City area, according to the Northwestern District Attorney’s Office.
Nine of the indicted people are scheduled for arraignment on insurance fraud, perjury and conspiracy charges this Friday at 2 p.m. in Franklin County Superior Court on Munson Street.
The indictments follow a year-long investigation by the Insurance Fraud Bureau of Massachusetts, the District Attorney’s Office, the Massachusetts State Police, and the Department of Homeland Security. The Fraud Bureau, a public-private investigative agency dedicated to the systematic elimination of fraudulent insurance transactions, notified the District Attorney’s Office of the alleged insurance scheme in 2013. The DA alleges the scheme involved people primarily from the metropolitan New York City area who insured and registered vehicles in Massachusetts by claiming to live at false or nonexistent residential addresses in Northampton, Easthampton and Greenfield.
By doing so, the DA alleges, the involved individuals paid substantially lower premiums than they would have had they reported their true addresses in and around New York City. During the six years during which this scheme is said to have operated, hundreds of thousands of dollars in premium avoidance is alleged to have occurred, according to a press statement from District Attorney David E. Sullivan.
The grand juries returned a total of 289 indictments against the 38 people involved, and 138 of the indictments are against Lefen “Helen” Chen, 55, of Flushing, N.Y., who is accused of orchestrating the scheme by accompanying the other involved individuals to insurance agencies and assisting them with the fraudulent insurance applications. Chen and eight others were arrested in New York on Aug. 12 and 13 and waived extradition to Massachusetts.
The fraud bureau is funded by automobile and workers compensation insurers in Massachusetts.