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July 17, 2010

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Man held for insurance scam

A MAN operating an unlicensed garage in Songjiang District has been detained for intentionally damaging customers' cars in order to collect the insurance money, police said yesterday.

Officers said Yao and his staff would copy the car owner's identification documents, claiming the garage would handle the insurance claim on behalf of the client, and then use the information to set up a bank account to collect the insurance payout.

Yao had earned more than 100,000 yuan (US$14,749) from seven car owners with the scam, police said. With the investigation ongoing, police expected they would find more victims.

A victim surnamed Chen sent his car to Yao's garage after it broke down.

Chen was told the frame was crooked, the fuel tank was leaking and some parts were missing, according to police.

Chen was confused, knowing that his car had never needed such repairs. So he checked his insurance record, which showed the car had been in four traffic accidents from 2008 to 2009 and he had been compensated 40,000 yuan. He had never been in such accidents.

A victim surnamed Zhang had a similar problem at Yao's garage.

Zhang's insurance firm rejected his bid to renew his auto policy due to some accidents that he was completely unaware of.

Police said both Chen and Zhang's cars were damaged by Yao's staff.

Officers said Yao's garage was fairly popular because it offered to handle insurance claims for its customers. The service was especially popular among clients that did not know much about settling insurance claims.

Police reminded drivers to have their cars repaired only at authorized garages.


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