South Carolina lawmakers target insurance fraud as fake crashes and claims surge

COLUMBIA, S.C. (WSPA) – Insurance fraud is happening every day across South Carolina. State law enforcement and insurance companies have noticed that criminals are now staging fake medical claims and phony car crashes. Organized fraud rings are faking car accidents by deliberately crashing into innocent drivers and filing false injury claims.

“We’re looking for people who are trying to enrich themselves unjustly by giving false information,” said Joshua Underwood, Director of the Insurance Fraud Division at the South Carolina Department of Insurance.

A new task force in the South Carolina State House was formed to listen to concerns from Law Enforcement and insurance companies to protect South Carolinians. The committee held a meeting this week in hopes of answering questions. Chief Mark Keel from the South Carolina Law Enforcement Division said he needs more resources.

“We are committed to this. We want to continue to add investigators. We want to continue to prosecute these cases,” he said.

Eric de Campos from Nation Insurance Crime Bureau added, “We believe that the fraud ecosystem in South Carolina can improve dramatically if we have more resources to go after these bad actors.”

Underwood said a big problem is that South Carolina only has seven, almost eight, investigators fighting insurance fraud across the state.

“So 5,000 complaints last year, SLED opened 152 cases and made 71 arrests. If you compare us to Virginia and granted more people; they have more than 8 million people, they have 28 agents,” said Underwood.

Jeff Thordahl, the Executive Director of South Carolina Insurance Association, said “We are glad the the House of Representatives, and the Review Committee in particular, is looking at fraud and other issues that affect insurance rates. Insurance fraud is not a victimless crime. Every time insurers pay fraudulent or overinflated claims, those costs are ultimately borne by policyholders.  The committee is wisely considering increasing the State’s fraud investigation resources. Prevention and prosecution help prevent premiums from rising due to fraud. “

South Carolina is ranked number 15 in questionable claims throughout the country, and Law Enforcement said that since we are a smaller state, that puts us disproportionately high.

Insurance companies did not attend the meeting, but Representative Gary Brewer, who led the meeting, said they will be at the next meeting in July to share their perspective.