United Auto Courts Reports

Congratulations to the investigators and prosecutors who put a major criminal behind bars for committing staged accidents and seeking to profit from false Personal Injury Protection (PIP) claims.

Oscar Luis Franco Padron was sentenced on May 29 in federal court in West Palm Beach on multiple charges including conspiracy to structure financial transactions for his role in a staged-accident fraud scheme. He was ordered to serve eight years in prison and pay $4.35 million in restitution. He was the latest and highest-ranking member of the scheme to be sentenced, the U.S. Attorney’s office said.

Padron managed chiropractic clinics and recruited patients to stage accidents. Other defendants have admitted in their guilty pleas that they would find people who had auto insurance from particular companies and recruit them to stage accidents.

“This massive ring orchestrated phony automobile accidents and made a living by defrauding insurance companies of millions of dollars,” U.S. Attorney Wifredo A. Ferrer said in a statement. “Auto insurance fraud is not a victimless crime. Not only were the insurance companies defrauded, but this scheme also hurt consumers as our insurance costs continue to soar because of fraud.”

The defendants “coached the participants on how to perform the staged accident, what to say to the police officer who responded to the scene, and how to claim that they have been injured,” according to the U.S. Attorney’s office.

After the staged accident, the drivers in both vehicles would file false injury reports with their insurance companies, claiming that they and their passengers, often family members, were injured.

The staged accident participants then supposedly went to chiropractic clinics for treatment. Instead, they completed claims for treatment partially or never received and were told what to say if an insurance investigator interviewed them about their injuries or treatment.

Three Palm Beach County clinics were involved in the PIP fraud scheme: Chiropractic Office of South Florida, Healthcare R Us, and New York Medical and Rehab Center.

The PIP fraud scheme was uncovered and arrests made through a joint effort of the IRS, FBI, Florida Department of Financial Services, and Florida Department of Insurance Fraud. The U.S. Attorney thanked the National Insurance Crime Bureau for its assistance.

“Fraudsters and criminal enterprises have learned how to game Florida’s auto insurance system and every honest Floridian with a car on the road ends up paying,” Florida CFO Jeff Atwater said in the statement.

“Through partnerships with law enforcement and state attorneys, we will go after these criminals, put them in handcuffs, and deliver them to justice,” he said.