| NO. 2004-120
FOR IMMEDIATE RELEASE
Press Release # 120
Tuesday, November 9, 2004
New York City Police Commissioner Raymond W. Kelly, Kings County District Attorney Charles J. Hynes And New York State Insurance Department Superintendent Gregory V. Serio Announce The Arrest Of 24 Individuals In The Takedown Of An Automobile Insurance Fraud Operation With Ties To Organized Crime
New York City Police Commissioner Raymond W. Kelly,
Kings Country District Attorney Charles J. Hynes and New York State Insurance
Department Superintendent Gregory V. Serio announce the takedown
"Operation Family Ties," which targeted an automobile insurance fraud ring
operating from an auto salvage yard in Brooklyn. Officers from the Department's
Auto Crime Division conducted the investigation over the course of the past
three years and arrested a total of 24 individuals including three organized
crime figures with ties to the Gambino and Bonanno crime
Commissioner Kelly said: "There is a direct correlation between
individuals like the ones arrested today and the high cost of insurance for
citizens of New York City. These criminals exploit the system for their own
financial gain and leave the rest of us to cover the cost. The Department,
working in conjunction with other agencies like the Kings County DA's office and
the New York State Insurance Department, is determined to end this type of
"These criminals are ripping off their friends and
neighbors as this kind of crime strikes in the pocketbooks of every person who
pays for auto insurance," said Kings County District Attorney Charles J. Hynes.
"I want to commend the NYPD Auto Crime Unit and my own Rackets Division for
their selfless efforts on this case which involved scores of hours of wiretaps
and surveillance work."
Superintendent Serio said: "The ongoing law
enforcement crackdown against those who allegedly perpetrate auto insurance
fraud is great news for honest consumers, who for too long have had to pay
higher premiums to offset this type of criminal activity. I'm also proud of the
substantive role the Insurance Department's Frauds Bureau was able to play
during the course of this investigation with the New York City Police Department
and the Brooklyn District Attorney's office."
The investigation began in
late 2001 when officers identified Flatlands Auto Sales as a key component in
numerous owner initiated insurance frauds. In this type of fraud, car owners
voluntarily "give up" their car to individuals who dismantle the vehicle and
sell the parts. Once the parts are sold and the hulk of the car destroyed, the
owner reports the car stolen and collects a reimbursement from the insurance
The major goal of the investigation was to discover each level
of the operation and who was involved. Among those arrested are the operators of
the salvage yard, buyers of the stripped auto parts and sixteen individuals who
owned high-end vehicles that were given up during the course of the
investigation. The cars have an estimated value of $1.5 million.
Officers on this case analyzed records and information provided by the
Department of Motor Vehicles, the National Insurance Crime Bureau, State
Insurance Frauds Bureau, telephone companies and banking institutions. In
addition, officers conducted a great deal of physical surveillance
proved vital in connecting the players and pieces in this case.
investigation is ongoing.