Car insurance fraud

An Action News investigation
March 9, 2009 8:40:54 PM PDT
Out-of-state drivers are exploiting a possible gap in Pennsylvania's car registration system.

Insurance premiums in our area are ticking upward but premiums here are still typically lower than in states like New York and Connecticut.

So many residents in those states are registering their vehicles in Pennsylvania to take advantage of our insurance rates others might register their vehicles here to hide a criminal record or a bad driving history, or to avoid scrutiny of their immigration status.

Whatever the reason it is illegal for out-of-state residents to register their vehicles in Pennsylvania! And to make matters worse it appears a flaw in our system is allowing this kind of fraud to happen.

Why are all these vehicles with Pennsylvania plates in New Haven, Connecticut? Especially considering it appears their owners have no ties to the Keystone State.

Then when you look at another set of documents a disturbing trend emerges. More than two-dozen vehicles, 26 to be exact are registered to one small row home on Willard Street in Philadelphia.

26 people couldn't possibly live there, there isn't even room to park 26 cars.

16 people have registered vehicles to a home on Kensington Avenue, 13 to Jeneice Torres' house on Margaret Street.

"I think it's outrageous," she said.

And unsuspecting Pennsylvania residents like Jeneice could get tangled in the web of problems created by these registrations.

But here's how Jeneice and other Pennsylvanians are already suffering the consequences. When a vehicle registered in Pennsylvania gets into an accident elsewhere that accident becomes a black mark here raising insurance rates for all consumers in the Commonwealth.

And states like New York and Connecticut say a significant number of accidents in their districts, particularly hit and runs, do involve vehicles that appear to be fraudulently registered in Pennsylvania.

"They're allowing people to register it seems by mail. They are not verifying identification or residence of the people registering the cars."

Independent tag agents handle the bulk of Pennsylvania's vehicle registrations; they're contracted with PennDOT to uphold the laws but the 65-hundred agents are overseen by only 26 state employees!

"We do appreciate your forwarding to us the information and I can tell you that as soon as we received that information, we began an active investigation into all 67 of those cases that were outlined in that document."

PennDot does now require consumers applying for Pennsylvania tags to provide a valid Pennsylvania driver's license or state photo I.D. card as proof they legally reside in the Commonwealth.

"Because we were finding it was a problem and it continues to be a problem. People are trying to find any way, any means possible to beat the system."

PennDot promises to try to eliminate any gaps that allow out of staters to continue to beat the system. In fact the state is now focusing much of its attention on this investigation launched by Action News.

"What we will do from that is we will learn from that and we will look to possible change a policy or procedure if necessary."

PennDot says it will provide us the results of its investigation we will certainly keep you updated.