Salinas men guilty of auto insurance fraud
Chelcey Adami , The Californian 5:06 p.m. PT Feb. 23, 2017
Two Salinas men have pleaded guilty to fraud charges related to their role in a “scratch out” scheme where a car is intentionally vandalized for insurance money.
In 2015, investigators with the Multi-Agency Detail Commercial Auto Theft, the Monterey County District Attorney’s Office and the National Insurance Crime Bureau found that two auto repair facilities in Salinas were involved in the scheme.
In a “scratch out” scheme, the owner or an associate fraudulently vandalizes the vehicle, and an insurance claim, often inflated, is filed for money to repair the damage. When the insurance company pays the claim, the money is shared between the repair shop owner, the vehicle owner and any other participants.
Investigators found that West Market Auto Body in Salinas, operated by Martin Lopez, 49, was participating in the scheme, according to the DA’s office.
In 2015, undercover investigators contacted West Market car painter Antonio Arias, 47, and asked him about the possibility of setting up a “scratch out” scheme. He agreed and then gave the undercover investigator instructions on how to damage the vehicle to avoid suspicion. He also gave guidance on what to say to the insurance adjusters in order to convince them the damage was legitimate, according to the DA’s office.
The undercover investigator followed Arias’ instructions, returned the damaged vehicle for repair, and after a claim was submitted, a check for $4,888 was issued to West Market Auto Body.
Investigators returned to the shop in late-2015, and Lopez then provided instructions on how to conduct the scheme. Another fictitious estimate was submitted to the insurance company, and Lopez received $5,006.18
Upon inspection of the body shop, investigators also found that the shop was not in compliance with worker’s compensation insurance laws, according to the DA’s office.
Arias was charged and pleaded guilty to a felony charge of auto insurance fraud and Lopez pleaded guilty to a felony charge of auto insurance fraud and a misdemeanor violation of worker’s compensation insurance fraud. Sentencing is scheduled for March 22.The District Attorney’s Office-Auto Insurance Fraud Unit works in conjunction with the Monterey County Sheriff’s Department MADCAT in investigating auto body shops throughout the County. Members of the public having information about possible insurance fraud are asked to report what they know to MCSO Detective Ken Owen at 831-755-7279, CHP Detective Chuck Rodriguez at 831-755-3818, DA Investigator Maribel Torres-Hart at 831-883-7588 or District Attorney’s Office Fraud Hotline at 831-755-3224