For Immediate Release
Contact: Greg Hayes
September 29, 1994


*Law Aims at 25% of Insurance Premiums Which Cover Fraud*

SACRAMENTO -- Sending a message to car thieves and perpetrators of insurance fraud, who cost Californians millions of dollars every year in premiums, Governor Wilson today supported efforts by Senator Art Torres (D-Los Angeles) to get tough on these hoodlums by signing his SB 1833, which will save consumers millions of dollars by fighting insurance fraud and auto theft.

"We cannot seriously reduce insurance premiums until we deal with the issue of fraud," said Torres. Twenty five cents of every insurance premium dollar goes to pay for fraud. "Fraud has become a disease out of control, making millions for thieves and costing honest, hardworking, taxpaying citizens millions of dollars every year in premium dollars." The National Bureau of Insurance Fraud estimates that fraud costs consumers $18 billion dollars a year nationally, and industry estimates put the cost as high as $50 billion.

California Highway Patrol Commissioner Maurice Hannigan praised the signing of Torres fraud crackdown legislation.

Torres bill establishes civil penalties for perpetrators of fraud and allows a portion of the money collected from the fines to help fund the fraud investigation units in District Attorney offices. Presently, District Attorneys are not able to pursue many fraud cases because of a lack of funds. "We must ensure that the District Attorneys have the resources to fight this problem and this law does just that," said Torres.

SB 1833 would also establish a definition for a non-repairable vehicle, allowing the Vehicle Identification Number (VIN) to be crushed. Car thieves presently steal the VIN off surgically stripped vehicles and burned-out hulks at auto auctions so they can re-register the cars they have stolen. They are then able to resell them without question so they can make easy money. 20% of stolen cars in the United States are stolen in California. "Without the access to the VIN numbers we cut into the profit of auto theft, and hopefully put a dent in that thriving industry," Torres declared.


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