CALIFORNIA : SOUTHLAND FOCUS : Insurer Sues Ex-Employee and Body Shops

Farmers Insurance Exchange of Los Angeles has sued a former employee and 27 auto body shops, accusing them of submitting fraudulent property damage reports and repair estimates. The lawsuit is the latest insurer effort to combat false claims using a California statute that allows companies to bring civil lawsuits against those suspected of insurance fraud. Previous lawsuits targeted doctors, attorneys and others accused of faking accidents or exaggerating injuries. Farmers said its investigation showed that the shops billed for work that wasn’t done and inflated charges for work that was completed, with the help of a former employee who processed the claims. The suit seeks $30 million in damages.