An enterprise insurance fraud scheme operating in lower Westchester and the Bronx has been taken down following a nearly two-year long investigation.

Westchester County District Attorney Anthony A. Scarpino Jr. announced the takedown of Operation Sledgehammer, in which five registered businesses and nine defendants were charged with enterprise corruption for defrauding insurance companies by enhancing motor vehicle damage and falsifying insurance claims.

Additionally, three other individuals were charged on separate felony complaints with other crimes relating to this scheme.

Auto insurance theft affects every one of us, said Scarpino in a press release issued by his office. Insurance fraud is not a victimless crime. When false claims are made and money is stolen from insurance companies, it forces all of our insurance rates to increase and costs each of us hard-earned money.

Between around May 31, 2019, and March 3, 2020, the defendants intentionally conducted and participated in a pattern of criminal activity in the form of auto insurance fraud via auto repair shops. This happened in the city of New Rochelle, in other parts of Westchester County, in Bronx County and elsewhere in the state of New York.

The defendants and uncharged and unnamed others were members of the Jawahir Enterprise, which operated and furthered an enhanced motor vehicle damage and automobile insurance fraud scheme. The Jawahir Enterprise focused on the defrauding of insurance companies by the submission of claims that evidenced enhancing damage to a vehicle either with or without knowledge of the vehicle owner and/or intentionally inflicting damage to vehicles that were not previously damaged.

Several schemes were used to defraud insurers. In some cases, defendants strategically enhanced vehicle damage so the body shop could increase the billed repair cost while keeping the actual cost of repair to a minimum. The insurer would be charged the higher amount. Another scheme involved staging accidents between two or more vehicles, at least one of which was owned by a person who had insurance.

An additional scheme involved members of the enterprise strategically striking insured vehicles with heavy objects such as sledgehammers or rubbing light assemblies alongside a vehicle. The damage was created to simulate collisions with stationary vehicles. At times, members of the Jawahir Enterprise created no new damage to their vehicles, but instead submitted claims to multiple insurance companies under different policies in an attempt to receive money.

The insurance companies primarily issued claim payments in the form of physical checks. In some instances, the proceeds of the fraudulently obtained insurance claim checks were laundered through a series of orchestrated deposits, transfers and cash withdrawals throughout bank accounts controlled by members of the Jawahir Enterprise.

During the early part of 2019, the National Insurance Crime Bureau began noting a disproportional number of high-end claims being submitted by Lees Auto Body located in New Rochelle for repairs to customers vehicles, said New Rochelle Police Commissioner Joseph F. Schaller in the release.

Suspecting that the claims had a fraudulent aspect, they then forwarded their initial findings to the Westchester County District Attorneys Office. A year-long investigation was launched by the Westchester County D.A.s Investigators in conjunction with the City of New Rochelle, City of Yonkers, New York State Police Special Investigations-Auto Theft Unit, New York State Department of Motor Vehicles Division of Field Investigations, New York State Department of Financial Services, New York State Environmental Conservation Police and the National Insurance Crime Bureau.

Through numerous investigative techniques, and unparalleled cooperation amongst members of all agencies, Operation Sledgehammer is being brought to a successful conclusion, Schaller said in the release. It is the largest Enterprise Corruption case ever prosecuted in Westchester County.

Four of the defendants Joseph S. Cermele, Rangee Jawahir, Georgette S. Sloley and Wayne M. Scott were arrested on Tuesday, December 1, 2020, and arraigned in New Rochelle City Court. The remaining individuals Ronnie Lee-Andros Jawahir, Allan Ramdeo Ramiah, Ronald Jawahir, Danesh Singh and Andrew Arjune were arrested Tuesday, December 8, 2020, and also arraigned in New Rochelle City Court. All individuals were released without bail and are to return to court on different dates throughout December and January.

All named individual defendants and companies have been charged with enterprise corruption, a class B felony, and other felony offenses listed in the felony complaint including grand larceny in the second degree, a class C felony, money laundering in the fourth degree, a class E felony, insurance fraud in the third degree, a class D felony, and grand larceny in the third degree, a class D felony.

These arrests send two messages, Scarpino said in the release. To all fraudsters: know that this type of illegal conduct will not be tolerated in this County and will be fully investigated and prosecuted. And to the people of Westchester: know that we actively seek out and bring to justice those enterprises which seek to gain illegal monies to the detriment of all insurance policy holders.

The case is being prosecuted by Investigations Division Assistant District Attorneys Laura Forbes and Emily Rowe-Smith. The investigation is continuing and more arrests are expected, the release said.

Source: Westchester County, New York, Office of the District Attorney

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New York Auto Insurance Fraud Ring Busted Following Two-Year Investigation - Insurance Journal