Farmers Sues Auto Glass Business for Submitting Phony Windshield Claims; Seeks Court Order to Halt Fraud and to Recover Damages; Alleges Over 1000 False Glass Claims Submitted

Farmers Insurance Exchange has begun serving civil summons and complaints upon a nationwide auto glass company and its president, accusing them of taking part in a scheme designed to defraud Farmers and its policyholders.

The civil complaint, which is similar to prior successful lawsuits against body shops who submitted false insurance claims, seeks not only damages for the fraud committed, but seeks injunctive relief, where the courts are asked to order a halt to these deceptive practices.

The lawsuit alleges a pervasive scheme where the glass company deliberately over-billed Farmers for services on 1,211 occasions. As alleged in the complaint, the defendants created sham offices in remote areas, so they could manipulate their billing. Under national guidelines, automobile glass claims are paid at a premium if the shop is located in less densely populated areas. The complaint further alleges that Defendants created documentation that their shops were located in the remote areas, so they could charge significantly more.

"This is a national issue, not a local problem. By secretly manipulating the system, this type of scheme leads to millions of dollars in false claims. This is not simply a billing error; our Special Investigative Unit has developed concrete evidence that this was a deliberate effort to defraud Farmers and its policyholders," said Doug Ashbridge, Director of Special Investigations. "When faced with evidence of fraud, Farmers will take proactive measures to stop such scams. Farmers wants to not only recover the money taken and prevent further phony claims, but the goal is also to make others think twice before submitting false claims. If you try to submit fraudulent claims, you risk being sued for your actions. This is part of our commitment to our policyholders to offer the best product at the lowest premiums possible."

Farmers developed evidence finding that at least 99% of the claims submitted by DKN Industries, Inc. DBA Legacy Auto Glass International and its President, David Nibarger, involved fraud. Farmers' Special Investigations Unit interviewed witnesses and documented the fraud. The locations where Legacy Auto Glass claimed to have shops were found to be shams. In one location, there was no glass business, but simply a painted advertisement on the side of another business. The second location was merely storage space. No glass work was done from these addresses. By pretending to have shops at these addresses, defendants were able to falsely charge more for their work.

Mr. Ashbridge went on to state: "Farmers has teams that are designed to detect precisely this type of fraudulent activity. Similar investigations are proceeding nationwide in an attempt to curb these windshield scams."

Farmers is represented by Dennis B. Kass, Manning & Marder, Kass, Ellrod, Ramirez, LLP.

600450 Farmers Sues Auto Glass Business for Submitting Phony Windshield Claims; Seeks Court Order to Halt Fraud and to Recover Damages; Alleges Over 1000 False Glass Claims Submitted
Date: 14 January 2005

See more news about:

Others also read

Emirates Glass, a Dubai Investment subsidiary, has won a major contract to supply 140,000 square meters of its premium glass to the prestigious development on the Palm Jumeirah, reaffirming its already established reputation as the single most prominent company in the entire regional glass industry.The deal was announced during the company's participation in the prestigious Big 5 show, the largest annual venue for the entire Middle-East glass contracting industry.
Isra Vision Systems AG supplier of machine vision systems, has successfully improved its market position in display glass inspection with a major order totalling 1.8 Mio Euro.
Packagers such as the UK's Rexam and private equity firms are set to vie for pump-sprayer business Calmar, which France's Saint-Gobain (SGOB.
The National Lime & Stone Co. will discontinue production of calcined lime early next month at its Carey plant, the company CEO announced Thursday.
Jain Scientific Glass Works, manufacturers of glassware for laboratories, is importing glass as raw material from China, which was much cheaper than the local product and abundantly available.
Japan 1 2 1 S. Korea 6 6 3 Southern Taiwan 4 2 0 Central Taiwan 0 4 2 AGC Japan 0 1 1 Taiwan (Yunlin) 1 1 1 Source: PIDA (Photonic Industry & Technology Development Association) Taiwan TFT-LCD Panel Makers Happy to See Substrate-price Falls in 2006 Taipei, Dec. 27, 2005 (CENS)--Both of the world's top-two glass-substrate makers are actively expanding their production capacity in Taiwan, which is expected to cut substrate transportation time and cost for local thin film transistor-liquid crystal display (TFT-LCD) panel makers and boost production efficiency, according to Michael Wang, project manager and senior analyst of Taiwan's PIDA (Photonic Industry & Technology Development Association).According to Wang, Asahi Glass Co. (AGC) of Japan has solved problems in lowering the defect-free rate for the production of fifth- and sixth-generation (5G, 6G) glass substrates, and is expected to tap the market with products with higher price competitiveness in 2006 to grab more market share in the 6G substrate businessIn addition, Wang added, the aggressive capacity added by both Corning of the U.S., the world's No. 1 substrate supplier, and AGC, the No. 2, will lead to price drops for glass substrates and will especially benefit TV panel makers such as AU Optronics Corp. (AUO) and Chi Mei Optoelectronics Corp. (CMO) in TaiwanCurrently, Wang pointed out, a 6G substrate is priced at about 27,000 to 30,000 Japanese yen, about 1,000 to 2,000 yen lower than in the third quarter of 2005.

Add new comment