American Morning

Tune in at 6am Eastern for all the news you need to start your day.
June 24th, 2009
09:36 AM ET

Torching cars for cash

It’s happening in Florida, California, New Jersey and Texas. More and more burned cars are turning up in tow yards these days. These are cars reported stolen from their owners, but law enforcement says it’s the owners themselves who are committing the crimes.

“Ordinary people are hiring others to torch their vehicles,” says Paula Dow, Essex County prosecutor in New Jersey.

Why? And who's doing it? Prosecutors in Newark, New Jersey have some answers.

“They're all types. But it really is Jane and John Q. Citizen that is doing it,” according to Michael Morris, asst. prosecutor in Newark.

Among the perpetrators, a convicted elementary school principal, and a businessman and a Dallas chiropractor who both plead guilty to attempted insurance fraud.

Driven, investigators say, by economic desperation to commit 'owner give ups'. That's when an owner reports their vehicle stolen, but actually stages the theft and torches the car to collect the insurance money.

“We've seen an increase in the number of vehicles that have been given up by owners,” says Det. Tom Reilly, Dallas County Sheriff's Department.

While there are no national numbers, Detective Reilly says that suspicious auto theft reports are up 12% this year in Dallas County.

In New York, the number of people who were arrested for suspicion of making a false auto theft report increased from 96 in 2007 to 130 in 2008, according to the New York Alliance Against Insurance Fraud.

But don't take Tom Reilly's word alone. Listen to the owners themselves, like John McCreey, the chiropractor who pleaded guilty.

“I made a lot of mistakes…the result of it's affected me financially.”

And Arthur Stewart, “When you do something you have to think of the consequences.”

Det. Reilly says the owners agreed to be videotaped as part of their plea agreements. He uses the tapes for a public awareness campaign.

“What better way than hear the words from people that committed fraud,” says Reilly

The latest numbers are disturbing. Exclude Essex County, where Newark is located, and New Jersey only prosecuted about 25 vehicle arson cases in 2007. Include Essex County and that number more than triples to 79 for the same period.

What are officials in Essex County doing to combat those numbers?

“We are aggressively prosecuting the wrong-doers here… We will prosecute those who hire as well as those who set the fire,” says Dow.

Filed under: Crime
soundoff (121 Responses)
  1. patrick davidson

    i think there should be a class in high school that touches on insurance, home owners and auto so most could be educated in this area and not be dissallussioned about what is expected and there lies the problem.

    most people even in insurance business done know what is covered or what they expect untill they have a cliam.

    June 24, 2009 at 3:46 pm |
  2. Chicago K-9

    To John Q.:
    See, if you'd had insurance, the lightning strikes would've been covered.

    June 24, 2009 at 2:54 pm |
  3. Hmmm....

    To Chicago K-9

    As a claim adjuster myself, I couldn't agree more.

    June 24, 2009 at 2:30 pm |
  4. Hmmm....

    To John Q Public,

    Are you a adjunct teach at a local Junior College? Your answers seems awfully rehearsed or even plagiarized

    June 24, 2009 at 2:26 pm |
  5. Ken

    They are just building their resume to enter politics. Now if they can just cheat on their taxes they will be ready for office.

    June 24, 2009 at 2:17 pm |
  6. john Q. Public

    I once had a car destroyed by a thermo-nuclear atomic bomb. My second car was hit by lightning seven times in a matter of minutes. Now I crawl to work to wash lettuce at McDonalds.

    June 24, 2009 at 2:17 pm |
  7. Les

    The liberal media refuses to follow up on insurance fraud. it is a problem of massive proportions effecting everyone that pays insurance. once in a while an article will appear but then nothing is done. very few people are prosecuted. the prosecutors statement is not true. the state of new jersey has a huge insurance fraud prosecutors office that gets about 32 million dollars a year yet prosecutes very few people. politicians do nothing. in fact senator codey just pushed through a bill that allows Drs to refer patients to surgical facilities that they own. hospitals in his district are closing but instead of helping them he helps his rich Dr friends. Business as usual in New Jersey. no matter what the ordinary person gets ......

    June 24, 2009 at 2:07 pm |
  8. Greg

    I had a car catch fire once. I drove home, changed clothes and went outside to see what I thought was steam. Once I realized it was smoke, I tried to open the hood but the release cable components had melted and seized or something and the release would not work. I called the fire department, a volunterr fire department, and about 30 minutes later they arrived. They removed the hood, I'll just say manually and put out the fire. It had spread past the firewall, behind the dash, and melted plasic was dripping on the floor board. Turns out the battery was the culprit. Apparently it had shorted and somehow caused enough heat to start a fire. It was a real bummer. I had bought the car used about a year earlier and literally had a single payment left on it. The used car lot didn't require insurance that would have covered the fire so I was just out of luck. Plus the deductible would have proably been more than the car was worth.

    June 24, 2009 at 2:04 pm |
  9. Greg

    Luckily I WAS one of the people buying one of these repossed cars at an auction. I drove it for 2 years then some Mexican without insurance pulled out in front of me. I nailed his @ss doing 45 and sheered off both of his passenger tires. Insurance Co. gave me enough money from just the car alone that I was able to purchase another outright. My first experience with airbags. Unfortunagely it was at 5:30am on my way to work and no witnesses that early.

    June 24, 2009 at 2:03 pm |
  10. Chicago K-9

    You poor, misguided people need an education. I've spent 20 years adjusting claims, all kinds of claims. I've helped put people in jail and seen others get away with stuff. So pay attention:
    First, a few drive uninsured because they just don't care, but most people who drive uninsured do it because they can't afford the insurance. And they can't afford it because our rates are so high from paying bogus claims made by people who engage in just this type of behavior.
    Second, the ideas that someone is entitled to 'cover their deductible' or 'get something back after paying years of premiums' are put forth by people who either don't understand insurance, or are themselves thieves at heart. Your insurance rates are calculated partially based on how much of the risk you are willing to bear (your deductible), partially on your loss history, and partially on other factors. You want a lower rate, raise your deductible or buy less coverage. Or drive a cheaper car. It's all a matter of choice, and YOU are making most of the choices. Don't like paying $3,000 a year for car insuarnce? Sell your brand new car. Stop speeding. Don't put in a stereo system that's worth more than the car.
    Third, open your eyes, people. How much do you spend on insurance? For most of us it's quite a bit. How many of you have taken the time to actually read your insurance policies? You pay hundreds or thousands of dollars a year for something you don't understand, you make no effort to try to understand, and then you cry like a baby about what's not covered, or about a policy limit you didn't know about, when the information was available to you all along. Or you pad your claim, or make up a claim and get paid. Now you think you got away with something, when all you did was take money out of someone else's pocket. You're a thief, no better than a pickpocket or a bank robber. There's no way to sugarcoat it and there's no other HONEST way to look at it. Pad your claim, or make a bogus claim, and you're a simple, everyday, run-of-the-mill thief.

    June 24, 2009 at 2:01 pm |
  11. john Q. Public

    To Hurley:

    You seem focused on framing the discussion on a symptom, not the underlying cause. Politics and "corporations" are relevant when discussing the reasons people are committing fraud these days. Put it all together and stop focusing on meaningless "single accounting entry line items." It's like you're content reading line items 4, 5 and 6 .. they add up to 15... but you just want to make "5" the reality.

    My point, this article discusses a symptom of a broader circumstance. Get it? Think big picture. You can't solve problems focusing on one out-of-context minutia. If you still think "that's crazy" you don't get it. That's really disabling. That's my opinion.

    June 24, 2009 at 1:57 pm |
  12. Allison

    I work in the insurance industry, I can't believe the attitude of entitlement that most of the comments show. When you have an insurance policy, you pay a premium, this does not mean that every claim made is paid.....apparently everyone forgot that if you car was really stolen and burned, or your house burned down to the ground, that the premium you paid is in no way comparable to what the payout is. You should be thankful that you don't have claims, but that does not mean that you should get your premium paid is the risk you take, but imagine if you did not have the insurance? who would you rip off? All of you that think this is the fault of the insurance industry, need a little education.

    June 24, 2009 at 1:48 pm |
  13. Phil

    Oh capitalism, what have you wrought? . . .

    June 24, 2009 at 1:47 pm |
  14. Puff the Magic Dragon

    I had a van once that was legitimately stolen and found burned…and I went through living hell with my insurance company, trying to prove that I DIDN’T do it. It was a freaking nightmare. Many years later, I had a truck stolen (legit too, it was on closed circuit TV outside the bar I was at when it happened, a crackhead with a screwdriver) and it was never recovered – and I had no hassle and no problem with that claim. Bottom line? You want your car gone, make sure it isnt found torched. Make sure its just gone, period. At least that’s how I read it – my insurance company basically taught me that. Take that, lipsticked, overzealous Progressive chick!

    That said, I don’t endorse that…but doesn’t that sound crazy? Sorry folks, bad credit is fixable, a felony for arson is NOT. Don't torch your car.

    And Dannyboy – please explain what to do when you buy a car that you CAN afford, then three years later, you cant afford it for unforeseen reasons? Not so simple, is it? You're an idiot.

    June 24, 2009 at 1:47 pm |
  15. real_person

    Why would anyone want to burn their cars to get out of paying for them? Now that they no longer have homes aren't they living in them?

    June 24, 2009 at 1:43 pm |
  16. Tim

    The change that is required, is the change that was promised during Obama’s run for office. I already stopped paying my house note so that Obama’s government will pay for it. I cancelled my health coverage because Obama is also going to pay for that. I believe Obama is going to pay for my car notes and give me government run insurance to cover it, so I will stop paying for those soon also. Those who voted for Obama thank you.

    June 24, 2009 at 1:43 pm |
  17. J of K

    So, question for Mr. O. is the economy still looking to you as being better off with all your added debit? Mr. O. please take an economic course and learn how to get this country back on track OR resign !

    June 24, 2009 at 1:38 pm |
  18. Jennifer

    It's no wonder people think they can get away with fraud when so many people are out there claiming the politicians they elected into office to represent them are doing the same thing.
    There is never a justification for stealing – and at the end of the day you are stealing from me because I have to pay more in insurance premiums to cover this.

    June 24, 2009 at 1:37 pm |
  19. Sane in Seattle

    Hey don't blame the politicians for anything, look in the mirror, we are the idiots that keep putting them in office.

    Face it, we would rather elect a rich aristocrat to office that tell us what we want to hear rather than a honest hardworking stiff that tells us we are over indulgent and that you don’t deserve anything simplify because you exist.

    June 24, 2009 at 1:37 pm |
  20. Fred Too

    You can't afford the payment anymore? File bankruptcy! The car will be reposessed and if you are really in bad financial shape the balance will be discharged in bankruptcy court. If you are just commiting fraud, then this won't help you either. This goes for homeowners who can't afford their mortgage as well.

    If you try to torch the house or car, chances are you will get caught. You'll still be in bad financial shape and now have legal bills and consquences on top of that.

    Look, I hate paying for insurance too, but even if I don't make a claim, some of my money goes to help you when you need it (and that is OK with me).

    June 24, 2009 at 1:37 pm |
  21. Joe Momma

    aren't insurance scammy anyway ? you dn't get a refund if nothing goes wrong, and even when they do, they don't provide nearly enough protection. i'd imagine if one didn't have insurance, they'd drive better and safer for fear of paying hefty repair bills and such.

    June 24, 2009 at 1:34 pm |
1 2