Once “uncommon and unsophisticated,” fraudulent activity targeting motor carriers and commercial drivers is now a “serious and pervasive threat to the trucking industry,” according to a report by the American Transportation Research Institute.

Fraud against trucking companies often comes in the form of staged accidents in which “entire ‘teams’ involving medical and legal stakeholders as well as fake victims and spotters often work together,” per ATRI.

Staged accidents have been around for a long time, Harry Rosenberg, a former US Attorney for the Eastern District, tells FreightWaves. But, he says, fraudsters who once targeted the drivers of passenger cars are now turning their attention to commercial vehicles.

One incident that has raised awareness about staged accidents played out in New Orleans in 2017. Perpetrators in two vehicles targeted a Triple G Express truck on the Danziger Bridge.

Footage from a dash cam on the truck showed “one vehicle being involved in the incident, fraudulently, intentionally, and the second vehicle being a ‘quote’ innocent bystander,” Randy Guillot, owner of Triple G Express and former American Trucking Associations’ chairman, tells WWL-TV.

The passengers in the vehicle that collided with Guillot’s truck withdrew their legal claims for compensation once the dash cam video came to light.

A federal investigation into a vast staged-accident ring in the New Orleans area has since led to charges against more than 30 people, many of whom have pleaded guilty, according to news reports.


‘Whales with Dollar Signs on Them’

Why are trucking companies becoming more attractive to staged-accident scammers? The answer: Follow the money.

In its report, ATRI analyzed some 600 cases and found there were 26 verdicts greater than $1 million between 2006 and 2011. Between 2014 and 2019, the number of verdicts exceeding $1 million rose to a 300 – an increase of 1,054%.

“These groups have moved to target large trucks because they are like whales with dollar signs on them,” Rosenberg tells FreightWaves.

Speaking to another news outlet, he says: “I don’t think big rigs were always part of the game in terms of staged accidents. I think individuals and groups soon realized where the big money was. Now you see insurance companies facing much larger claims. It was $20,000 or $30,000; they’re now $500,000 or $600,000 claims.”


Fraud, Large Verdicts Are Felt Industry-Wide

Those huge claims against individual carriers and their insurance companies translate into ever-increasing rates and difficulty getting coverage for trucking companies across the industry.

“We’re currently in what is referred to as a hard market. For the past 10 to 12 years, commercial auto insurers have been losing money and have been taking steps to correct this,” Dan Petrillo of Laporte Insurance, an EROAD strategic partner, says. “One of the ways in which they do that is that they will simply just pull out of that space or restrict what they’re willing to write. Another way they’re doing it is through year-over-year rate increases, which everyone who purchases commercial auto insurance is experiencing.”

In some instances, skyrocketing insurance rates are forcing carriers out of the business. That was the case for one company mentioned in the ATRI report that faced a year-over-year rate increase from $340,000 to $700,00.

“Multiple other fleets, many decades-old family businesses, experienced similar outcomes,” per ATRI.


How Can Carriers Protect Themselves?

Research shows that commercial drivers are at fault for accidents far less often than the drivers of passenger cars. If that’s the case, what accounts for the exponential increases in size and frequency of large verdicts against trucking companies?

It’s being driven by litigation, according to Petrillo.

“There is a dynamic that exists right now and has for about the last 15 years where plaintiff attorneys have a prescribed methodology of suing trucking companies,” he says. “The way they manipulate the jury is, essentially, painting these motor carriers as bad actors and the only way to send a message is through the pocketbook.”

And the success of plaintiff’s attorneys at winning huge verdicts has put large trucks on the radar of staged-accident scammers.

To protect their drivers and businesses, many carriers have added dash cams to their fleets. In the case of non-fraudulent accidents, dash cam footage can help exonerate a commercial driver. As for staged accidents, video evidence can expose the criminal activity.


Download the free report: How Dash Cams Protect Your Drivers and Your Business

Staged Accidents a Serious Threat to Motor Carriers

by | Jun 7, 2021 | , ,

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