NEWS ALERTNICB Launches Effort To Prevent Fraudulent Sale of Vehicles
Damaged By Katrina PALOS HILLS, IL (PRNEWSWIRE) - Special insurance industry teams will be assisting law enforcement and insurance companies in identifying and cataloging vehicles damaged by Hurricane Katrina to prevent their fraudulent resale to unsuspecting consumers in the future.
Flood Vehicles:
Avoid Purchasing A Washed-Up Vehicle By definition, a flood vehicle has been completely or partially submerged in water to the extent that its body, engine, transmission or other mechanical component parts have been damaged. If the vehicle is so damaged that it is no longer operable, the driver's insurance company settles the claim by buying the vehicle and selling it as a "salvage" at an auto auction.
Dishonest and unscrupulous car dealers buy the vehicles, dry and clean them, yet leave plenty of hidden flood damage. They then transport the vehicles to states unaffected by the storm or natural disaster and sell them as used vehicles to unsuspecting buyers. These dishonest dealers will not disclose the damage on the vehicle's title as they are required, which is a crime called "title washing." The vehicles are then sold with the hidden damage.
Fraud Prevention Tips Take preventive measures before purchasing a used vehicle to avoid being victimized by flood vehicle fraud:
* Select a reputable car dealer.
* Inspect the vehicle thoroughly for water stains, mildew, sand or silt under the carpets, floor mats, headliner cloth and behind the dashboard. In addition, a complete mechanical inspection should be made by a qualified technician. These inspections should be performed
before the vehicle is purchased.
* Ask about the vehicle's history. Ask whether it was in any accidents or floods.
* Inspect the title and ownership papers for any potential or questionable salvage fraud.
* Conduct a title search of the vehicle.
* Look under the hood for signs of oxidation. Pull back rubber boots around electrical and mechanical connections for these indicators:Ferrous materials will show signs of rust.Copper will show a green patina.Aluminum and alloys will have a white powder and pitting. * Trust your instincts: If you don't like the answers or the deal sounds too good to be true, it likely is. Walk away from any deal you are not comfortable with.
If you suspect insurance fraud or theft, call the NICB toll-free hotline at 1.800.TEL.NICB (1.800.835.6422). Your call is free. NICB advises that your call can be anonymous and that you could be eligible for a reward.
(Source: NCIB)
Robert M. Bryant, president and CEO of the National Insurance Crime Bureau (NICB), announced that he is dispatching special catastrophe teams to Baton Rouge, LA and Mobile, AL. The effort is expected to last from six months to a year.
The NICB is a not-for-profit organization that receives support from approximately 1,000 property/casualty insurance companies. The organization partners with insurers and law enforcement agencies to facilitate the identification, detection and prosecution of insurance criminals.
Authorities estimate that thousands of vehicles have received damage from flooding in the New Orleans area alone. That number is expected to grow as claims from Mississippi are processed.
Bryant explained that unscrupulous salvage operators and dealers often try to conceal the fact that vehicles have been damaged by a natural disaster from potential buyers.
"By creating a registry of damaged vehicles now, the potential for this type of fraud can be greatly reduced," he said. In addition to vehicles, NICB also is alerting disaster victims to be aware of the potential for fraud that exists as efforts to repair and rebuild get underway.
"Fraud is an unfortunate reality in post-disaster environments," Bryant said. "For example, NICB and its insurance and law enforcement partners in Florida have pending investigations as a result of unscrupulous contractors who scammed victims and insurance companies in the aftermath of last year's four hurricanes.
"So too, as the initial recovery from Hurricane Katrina begins, there are people right now who are planning to converge on this area in order to obtain from disaster victims what little they have left or what they are entitled to from their insurance coverage."
For more information, visit NICB's Web site at www.nicb.org.
(Source: PRNewswire)
