HomeMy WebLinkAboutMINUTES - 04071992 - 1.9 (2) K - BOARD OF SUPERVISORS
FRW GARY T. YANCEY C rtra
District Attorney
Costa
DATE; March 18, 1992 C
oiry
SUBJECT: Approval For Submission and Execution of a Contract With the State of
California, Department of Insurance, For the Purpose of Combating Automobile
Insurance Fraud For the Period July 1, 1992 through June 30, 1993
SPECIFIC REQUEST(S) OR RECOMMENDATION(S) & BACKGROUND AND JUSTIFICATION
I. RECOMMENDED ACTION
Authorize the District Attorney to submit an application and execute a
grant award contract, including any extensions and amendments thereto, with
the State of California Department of Insurance for funding of the
prosecution of automobile insurance fraud for the period July 1, 1992
through June 30, 1993, in the amount of $166,361.
II. FINANCIAL IMPACT
None.
The grant application in the amount of $166,361 will fund the salary and
benefits for an attorney, part-time investigator, and clerk assigned to the
program. The balance of the investigator's salary and benefits will be
covered by a companion grant award to prosecute workers compensation
insurance fraud. The automobile insurance fraud award is allocated from a
trust fund financed by a current assessment of $1.00 per insured vehicle
payable by the insurer. Of this amount, approximately one-half is
earmarked for distribution to district attorneys for enhanced prosecution
of automobile insurance fraud. Supplantation is prohibited. Position and
budget adjustments will be submitted for Board action if the application is
approved by the state.
III. REASONS FOR RECOWENDA TION/BACKGROUND
The Legislature has determined that one of the significant factors driving
up the costs of auto insurance is fraud. While fraud is recognized as a
growing problem across the country, California is an area of concentrated
criminal activity in insurance fraud. While originally the problem was
confined to the Los Angeles area, recent statistics confirm that the
problem is rapidly becoming a statewide problem.
The Department of Insurance Fraud Bureau was established in 1979. However,
resources committed to fighting fraud were limited. In 1989, the
Legislature acted, through SB 2344 and subsequently through SB 1103 in
1990, to enhance resources for auto insurance fraud investigation and
prosecution through a per vehicle surcharge in California. That investment
has resulted in dramatically increasing the number of prosecutions for auto
insurance fraud statewide. In the past two yea s, the number of suspected
CONTINUED ON ATTACHMENT: X YES SIGNATURE:
RECOMMENDATION OF COUNTY ADMINISTRATOR RECOMMEN ATION O OARD IMITTEE
APPROVE OTHER
SIGNATURE(S):
ACTION OF BOARD ON APPROVED AS RECOMMENDED i\ OTHER
VOTE OF SUPERVISORS
1 HEREBY CERTIFY THAT THIS IS A TRUE
UNANIMOUS (ABSENT _ ) AND CORRECT COPY OF AN ACTION TAKEN
AYES: NOES: AND ENTERED ON THE MINUTES OF THE BOARD
ABSENT: ABSTAIN: OF SUPERVISORS ON THE DATE SHOWN.
CC: District Attorney ATTESTED 7
County Administrator, ATTN: G. Roemer PHIL BATCHELOR. CLERK OF THE BOARD OF
Auditor-Controller SUPERVISORS AND COUNTY ADMINISTRATOR
BY (/ ,DEPUTY
M382�1-83
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fraudulent claims referred to the Fraud Bureau has tripled. Both the
implementation of the newly mandated carrier-based special investigative
units to identify and report fraud and the Automobile Insurance Claims
Depository to receive and analyze claims for fraud will operate to uncover
large numbers of fraudulent claims which now go undetected.
During 1991, approximately 47 suspected fraudulent. claims were reported for
Contra Costa County to the Department of Insurance Fraud Bureau. Based on
enhancement of their enforcement staff, the Department of Insurance is
telling us that they expect fraud claim reports to double or triple during
the 1992-93 fiscal year. If the grant award is approved, it will allow the
District Attorney to place specially trained staff in our Criminal Fraud
Division who will be able to concentrate on the complex and growing
problems of automobile insurance fraud.
IV. CONSEQUENCES OF NEGATIVE ACTION
Failure to approve this recommendation would result in the inability of the
District Attorney to apply for $166,361 in state funds designated for use
by Contra Costa County in the prosecution of automobile insurance fraud. A
county which fails to submit their application shall not be considered for
funding, and their undistributed funds shall be returned to the Department
of Insurance fund to be reprogrammed.
AIF01.00C/MAR92