Scam Targets Truckers in Risky Crashes, Officials Say : Fraud: Poor immigrants are recruited for schemes that set up big rigs for collisions, investigators charge.

Deja vu swept over California Highway Patrol Officer Patti Mackey as she began to interview the victims of a traffic accident in April on the Long Beach Freeway in East Los Angeles.

Wasn’t passenger Fabricio Garcia the same man she had talked to after two nearly identical freeway accidents involving cars filled with people that were rear-ended by tractor-trailer trucks? Nobody could be that unlucky.

In fact, investigators believe, luck had nothing to do with it.

Acting on Mackey’s recollection and the assistance of a police informant, investigators have concluded that this crash, and dozens of others on Los Angeles freeways during the last few months, are part of a bizarre new scam that has carried the practice of staging accidents to collect insurance money to a new, high-risk extreme.

Ringleaders and their recruits, say authorities, carefully scheme to take to the freeways in search of giant trucks, pull in front of them and slam on the brakes to cause rear-end collisions that they hope will net thousands of dollars in insurance payments.

“Every area in our division is experiencing the same phenomenon,” said Marco Ruiz, a Los Angeles-based Highway Patrol investigator. “It seems like it was something that just sprung up out of the last few months or else we were in the dark all these years and didn’t know that this was happening right under our noses.”

More than 20 people have been charged in five suspected freeway crash rings during the past three weeks, and more arrests are expected, according to the Los Angeles County district attorney’s office.

Searches of suspects’ apartments and glove compartments have turned up “wreck scripts” that carefully lay out roles and actions for the accident, authorities say. In one case, investigators found that the back of a station wagon used in a crash had been filled with tires to absorb the impact.

In the standard routine, known as “swoop and squat,” or el toro y la vaca (bull and cow), one car pulls in front of the truck and slows down. Then a second car darts in front of the first car and stops, causing the first car to brake suddenly and be rear-ended by the truck. Often a third car travels in the lane to the left of the truck to prevent the truck driver from changing lanes to avoid the wreck.

The truck driver in a Long Beach Freeway accident told Highway Patrol officers that he noticed the driver and front-seat passenger lying in reclined seats just before they swerved in front of him, apparently bracing themselves for the crash.

Trucks are the favored targets because their owners are more likely to carry insurance than some motorists, investigators say. And, they add, staging rear-end collisions with big rigs is a cinch because truck drivers are unable to stop quickly.

But who would be foolhardy enough to take part in such a dangerous con?

The answer is desperately poor Latino immigrants recruited to ride in the crash cars for as little as $100 each, court records and interviews indicate. They are paid by ringleaders, or “cappers,” who earn thousands of dollars from the wrecks.

“These people have no means to begin with and they’re out there trying to provide for their families--not that it’s a right thing to do, of course,” said defense attorney Michael I. Sidley. He emphasized that he was speaking in generalities and not admitting his client’s involvement.

Sidley, who is defending Miguel Luque Morales, 26, said the poverty that drives people to take part in staged accidents is a “social problem that needs to be solved.”

Sometimes the price this enterprise exacts is high. Jose Luis Lopez Perez, 29, was killed June 17 in the back seat of a Pontiac Firebird crushed by a car-carrier truck on the Golden State Freeway near Sun Valley. Lopez Perez is thought to have been a lieutenant in one of five rings identified by California Highway Patrol investigators, although his family vehemently denies that allegation.

Lopez Perez had made his living as a day laborer since he arrived from El Salvador 18 months ago, said his brother, Concepcion Lopez of North Hills. Lopez said he cannot believe that his brother would have taken such a risk because he and his wife, who works as a live-in housekeeper, were supporting their two young children who remain in El Salvador with their grandparents.

“He had just started to live his life,” Lopez said in Spanish. “How could anyone put themselves in a position to die like that? Everyone I know says that’s ridiculous.”

The driver of the Firebird and two other passengers riding with Lopez Perez when he was killed are among the 20 people arrested on suspicion of insurance fraud. The three also have been charged with murder. Ruiz said officers believe that the suspected capper of the ring, Filamon Santiago, 24, of West Hollywood, has fled.

In light of the recent rash of crashes, Highway Patrol investigators are taking a second look at a fatal wreck in March in Los Cerritos, Ruiz said. In that case, a car burst into flames after being rear-ended by a truck. Two passengers burned to death and were never identified. The third got out of the car and fled.

Although injuries were reported in all of the other suspected fake freeway accidents, investigators say they do not know whether any of them are valid claims.

Typically, court records show, the recruiters and participants meet at mini-malls, fast-food restaurants or alleys to nail down last-minute details and remove license plates from some of the cars before staging the crash.

A participant in one ring, who turned informant, told authorities that organizers of his operation set up three to five accidents a week on the Long Beach Freeway before they were arrested in early June.

Scott Koppel, an attorney who specializes in handling fraud cases in court on behalf of insurance companies, marveled at the big-rig trend and predicted that news of Lopez Perez’s death might act as a deterrent.

“It doesn’t make sense that that would become something popular because of the risk involved,” he said.

Officials at the California Trucking Assn. in Sacramento have not heard about the phenomenon and were baffled about why trucks were being targeted.

“Trucks may have more insurance coverage,” said association spokesman Jay Banrein, “but it’s liability coverage, which only pays if you win in court. Of course, these people may be hoping for a settlement outside of court.”

In the past, he and others said, stagers of automobile accidents seemed to be interested primarily in the quick, no-questions payoff of their own cars’ medical coverage, usually a maximum of $5,000 per passenger.

Trucks often carry liability insurance up to $1 million, far above the $300,000 upper limit typically selected by automobile owners, said Larry Stanford, supervising criminal investigator for the California Department of Insurance.

And liability coverage is what the freeway crash rings are after, insurance investigator Tom Sandbakken has concluded. Juries are more likely to be swayed by the extreme damage to the car in a truck-car accident, which means out-of-court settlements are likely to be more generous and more common, said Sandbakken, who investigates fraud for the Mercury Insurance Group.

To help combat the outbreak of setup crashes, Banrein said, the trucking association’s next weekly newsletter will include a warning to take extra caution when driving through Los Angeles.

As the danger involved in the operations has become more evident, prosecutors have been pushing for higher bail for suspects. Judges in Los Angeles Municipal Court, where the alleged staged-accident cases are pending, initially set bail as low as $5,000. But bail for several defendants recently was set at $500,000, and those charged in Lopez Perez’s murder are being held without bail.

Investigators have not determined whether the five rings are linked, although alleged participants in various rings did live within blocks of each other in Koreatown, South Gate, East Los Angeles and Compton.

Two freeway fraud cases probably will be tried together, prosecutors said, because the Firebird in which Lopez Perez was killed was owned by Oscar Leonel Lopez Portillo, 23, of Southeast Los Angeles, accused of being a recruiter in another case.

Like other crash fraud rings, the freeway scams involve people from a single ethnic group--in this case Latino. Los Angeles County investigators have previously uncovered rings formed by African-Americans, Korean-Americans and Armenian-Americans, said Hal Huber, supervising criminal investigator for the state Department of Insurance.

Ethnic and racial groups tend to work together in such frauds because of the level of trust needed when large numbers of conspirators are involved, said Ruiz, the CHP investigator.

Investigators hope to get to the top of the fraud rings, where they believe they will find attorneys and doctors who aid and perhaps coordinate the scams. Numerous letters to attorneys documenting alleged injuries were seized during the searches of the alleged organizers’ homes. A card in Lopez Perez’s wallet contained the name of a lawyer whose partner was arrested in May on insurance fraud charges.

In a recent interview, Dist. Atty. Ira Reiner complained that the rings “can’t operate without crooked lawyers. They are the ones we want to convict.” But Deputy Dist. Atty. Barry Thorpe, one of two prosecutors in the cases, said lawyers are tough to implicate because “they are smart. They rarely deal directly with the cappers, but instead let an office manager make the deals.

“And they never mark a case file with a code to indicate that it’s a capper case or staged accident. They know that’s the sort of thing investigators will be looking for.”

Over the years, cappers have become bigger players in the frauds, sometimes arranging the accident, then trying to sell it to an attorney. Huber, with the state insurance department, said a decade ago a crooked lawyer would pay a capper $200 to $300 for a phony accident case. In recent years, cappers have been getting $1,500 to $2,000 per case, he said.

In the three months since the investigation began into the big-rig wreck scam, each arrest has led investigators to other fake accidents involving trucks.

Court records indicate that passengers and drivers have confessed to participating in numerous tractor-trailer accidents, many of which were confirmed through accident reports on file with the Highway Patrol and the state Department of Motor Vehicles.

Marvin Eugenio Velasquez admitted to the Highway Patrol that he had been in at least six other recent accidents with big rigs, four of which were confirmed by investigators, records show.

In the apartments shared by some of the repeat participants, officers also found Department of Motor Vehicles medical examination reports, telephone numbers for the nearest CHP office and temporary identification cards--usually without pictures--under various names, all of which they said led them to other suspected staged accidents.

Bail investigation reports show that some of those arrested have criminal records, with offenses ranging from assault and battery to transporting illegal immigrants. Several also have long lists of traffic warrants.

Yet some of the lesser players maintain they were virtual mannequins, with little or no knowledge about how the fraud was to unfold. The Highway Patrol informant told police he was recruited by a stranger on an East Los Angeles street for one of the staged wrecks.

When passenger Rubidia Lopez was called into the courtroom last week to face murder charges related to Lopez Perez’s death, she sobbed in Spanish: “I did nothing, nothing.”

Attorney Timothy C. Lannen, defending the other passenger in the Firebird, said his client arrived in Los Angeles from El Salvador only a few days before the June 17 wreck.

“There’s no question that some of them were recruited at the last minute,” Lannen said.

Accident or Fraud?

Five alleged insurance fraud rings in the Los Angeles area have been accused of staging rear-end accidents with tractor-trailer trucks on freeways instead of the more common practice of setting up fender-benders with cars on city streets. Ringleaders apparently believe truckers are more likely to be insured than the average motorist, but the “accidents” also are far more dangerous, leading to one death last month.

This is the way the “swoop and squat” scam works: A) People are hired to drive and ride in two or three cars.

B) The group meets and the license plates are usually removed from the first car.

C) Two or three cars get on the freeway and the second car pulls in front of a tractor-trailer rig and slows down. If there is a third car, it pulls into the lane to the truck’s left to prevent the truck driver from changing lanes to avoid an accident.

D) The first car swerves in front of the second car, stops suddenly, then leaves the freeway.

E) The second car brakes to avoid hitting the first car, then waits for the truck to rear-end it.

F) The passengers and the driver in the second car wait for Highway Patrol officers to arrive, often saying their necks and backs hurt. The car is usually filled with passengers so more claims can be filed.

G) An accident report is filed with the CHP and the Department of Motor Vehicles.

H) An attorney--who investigators believe may be involved in the scam--files an injury claim with the trucker’s insurance company. Investigators believe that the ringleaders split the proceeds.