A scheme to defraud insurance companies out of thousands of dollars by staging auto accidents has resulted in a conviction for a Modesto man, while other local men, including one from Ceres, are awaiting criminal charges for the same scheme.
Victor Hugo Soriano-Villafan, 26, of Modesto, pleaded guilty Tuesday to conspiracy to commit mail fraud in a scheme to defraud insurance companies, according to the U.S. Attorney's Office.
The U.S. Attorney's Office stated that charges are pending against co-defendants Juan Ortiz Rivas, 39, of Ceres; Liobigildo Vargas, 46, of Turlock; and, Juan Marquez Cadenas, 30, of Patterson for the same scheme.
The scheme was carried out between October 2011 to August 2014. During that time Soriano-Villafan conspired with at least six other individuals to stage dozens of car accidents and submit false claims seeking compensation for the damage caused by the staged accidents.
In each staged accident, Soriano-Villafan and the other defendants used two or three vehicles and caused about $5,000 to $10,000 in damage to each vehicle, according to the court records. After each staged collision, the defendants submitted cover stories to the insurer that concealed the true cause of the accident.
The cover story would commonly use aliases, false identities, and false addresses when describing the defendants. The defendants also used different vehicles in the staged collisions. They were able to do this by obtaining many different vehicles and using false identities to both register the vehicles with the Department of Motor Vehicles and obtain insurance policies for the vehicles. The defendants did this to avoid scrutiny by the insurer that reviewed the false claims.
The defendants repeated the scheme in dozens of crashes by recruiting other individuals to participate in the staged collisions. These individuals would allow their vehicles to be damaged and would submit their own claim for damages. In many instances, false claims were submitted to the recruited individual's insurance company.
As part of the scheme, the defendants would often offer to repair the recruited individual's vehicle at automobile repair shops that Soriano-Villafan or a co-defendant owned, usually with less-than-complete repair work, and for a fee that was less than the payment from the insurance company. In all, Soriano-Villafan caused at least $750,000 in false insurance claims to be paid as a result of the conspiracy to defraud.
This case is the product of an investigation by U.S. Immigration and Customs Enforcement's Homeland Security Investigations and the California Department of Insurance, Fraud Division. Assistant United States Attorneys Patrick R. Delahunty and Henry Z. Carbajal III are prosecuting the case.
Soriano-Villafan is scheduled to be sentenced by U.S. District Judge Dale A. Drozd on January 30, 2017. Soriano-Villafan faces a maximum statutory penalty of 20 years in prison and a $250,000 fine.