Press Release

Major Trade Associations Announce New Legislative Partnership to Stop Towing & Staged Accident Fraud

Apr 05, 2021

The American Trucking Association, American Property Casualty Insurance Association, & the Coalition Against Insurance Fraud join forces to tackle towing fraud across America

Washington, D.C. –– Today the American Trucking Association (ATA), American Property Casualty Insurance Association (APCIA), and the Coalition Against Insurance Fraud pledged to leverage the power of their combined resources and influence to secure passage of needed legislation to tackle the scourge of towing fraud and staged vehicle accidents across the country.

These issues and many more are driving up the costs of the products Americans rely upon. A recent ATA survey of nearly 200 motor carriers found that 77 percent of respondents cited law enforcement referrals as their primary issue when selecting a towing company, and 70 percent of surveyed carriers reported facing serious issues with getting their cargo released after a tow.

“The partnership brings the nation's largest property-casualty insurance and trucking associations together and pairs them with the Coalition’s formidable consumer interest credibility and voice in the field of insurance fraud,” Coalition Executive Director Matthew Smith said. “When it comes to changing the landscape for policy holders in the specific arena of towing and staged accident fraud with these three organizations, the possibilities are endless.”

Among the issues ripe for redress: staged auto accidents and bandit towing. Staged crash rings are a dangerous and pervasive issue. A New Orleans crash ring has made recent headlines, with the personal injury attorneys suspected of facilitating bogus claims under indictment and the supposed ring leader murdered days after his federal indictment was reported. Frequently America’s commercial trucking providers are the targets of many staged accidents which are often related to organized crime ring activity. In 2019 New York enacted “Alice’s Law” –– legislation that was inspired by 71-year-old Queens grandmother, Alice Ross, who was killed in a staged accident in 2003. These staged accidents result in fraudulent insurance claims for fake crash injuries, costing companies and their policyholders upwards of $1 billion per year. These crimes pose a serious public safety risk–– especially for women and elderly drivers who are often targeted for these accidents, because the perpetrators consider them less likely to start a confrontation.

“Our members are increasingly concerned with the impact predatory towing and staged accidents are having on their ability to conduct business,” said ATA Chair Sherri Garner Brumbaugh, president and CEO of Garner Transportation Group, Findlay, Ohio. “By joining with APCIA and the Coalition Against Insurance Fraud, we are confident we can put an end to these unscrupulous and unethical practices.”

In local jurisdictions throughout America towing companies are abusing insurers and crash victims by showing up to sites without authorization (or contacted by authorities that receive kickbacks) to tow unsuspecting vehicle owners at exorbitant rates. These tows often include unreasonable storage and access fees. 

“We know from our members that some of the most egregious examples of abuse arise out of accidents involving commercial vehicles,” said Robert Passmore, Department Vice President, Auto & Claims Policy, for APCIA. “We look forward to working with the other members of the CAIF and the ATA to address these issues across the country. “

The partnership comes on the heels of the formation of a new ATA led task force created in response to trucking companies reporting in an industry-wide study the abuse they have suffered at the hands of towing companies excessive overcharging for nonconsensual towing of damaged heavy-duty trucks and trailers removed from crash scenes. The group will release a guide on how to prevent becoming a victim of billing fraud both pre- and post-tow. Simple steps such as documenting what equipment was on-site and educating drivers not to sign “consent to tow” forms can save carriers thousands of dollars and hours of wasted time.

Momentum is growing behind these issues, and changes could be coming at the federal and state levels very soon. Expect more news from this important partnership as they discuss the development of model legislation, new regulations, and best practices to fight towing and staged accident fraud.