United States Law Reporter

UPDATED: Speed Channel "Chop Cut Rebuild" show guest among mechanics caught in fraud sting
June 03, 2010 12:55 PM
By RACHANEE SRISAVASDI, DENISSE SALAZAR, SALVADOR HERNANDEZ and ALEJANDRA MOLINA / THE ORANGE COUNTY REGISTER
EDITOR'S NOTE: An earlier AP version of this story contained an error inadvertently provided by the District Attorney. The suspect linked with the Speed Channel show made a guest appearance and was not the host.

SANTA ANA – County prosecutors have charged 53 auto body repair workers – including 24 repair shop owners — in a sting operation aimed at uncovering repair shops that engage in insurance fraud.

One of the people arrested had appeared on the show "Chop Cut Rebuild" on the Speed Channel.

"Operation Straight Body" consisted of 152 undercover operations at shops throughout the county from January to May, Orange County District Attorney Tony Rackauckas said Thursday.

PHOTOS: View related photos of the sting on the Orange County Register website

Authorities arrested the individuals Wednesday and Thursday. Each has been charged with one felony count of insurance fraud, prosecutors said.

Rackauckas, who held a news conference about the sting operation, said taxpayers end up footing the bill for such fraud through higher insurance rates. But several of those arrested – and some of their employers – questioned the tactics and legitimacy of the sting operation and insisted on their innocence.

Here's how prosecutors say the sting worked: District Attorney investigators, posing as customers, brought a damaged Ford Expedition or a damaged Mercedes-Benz to auto shops that had consumer complaints in the last three years.

Insurance claims can't be filed under new policies for damage incurred before the policy was issued, prosecutors said. But investigators asked the shop workers if they could repair what the investigators said was new damage to the cars – as well as damage sustained before the cars were supposedly purchased – under a single insurance estimate.

Most declined, stating that the damage required separate claims, prosecutors said. But 53 estimators agreed to include the damages under the same estimate, they added.

"This prosecution put dishonest operators and anybody thinking about committing fraud on notice," Rackauckas said. "I think consumers have the right to know which of the auto repair shops are conducting straight business and which are not."

Several body shop owners and employees charged in the sting said they were not guilty, and questioned the techniques used by investigators. They said they agreed to give an estimate of the vehicles' total damage, but never discussed whether the cost would be covered by the customer or an insurance company.

One individual charged is Richard Todd Evans, a custom-car builder and owner of Huntington Beach Bodyworks who has appeared on automotive television programs, including "Chop Cut Rebuild."

His defense attorney, Dyke Huish, said county prosecutors were criminalizing what is a common, and legal, practice.

Evans wrote up a $5,700 estimate for the undercover investigator who brought the Expedition to his shop on May 4, according to Huish.

"All he did was to give an estimate that the guy requested of him. Even the paperwork states not to submit a false claim to an insurance company,'' Huish said. "He didn't submit anything to the insurance company at all."

Will Hawes, owner of Southern Auto Body in Costa Mesa, called sting operation "100 percent entrapment."

One of Hawes' employees, Robert Charles Gomez, was charged in the sting. "All we did is do what the customer asked us to do," Hawes said.

Hawes said the investigator walked into his shop April 14 and asked to fix a Ford Expedition that had a bent rear frame which was supposedly sustained during a crash. The rear bumper was also missing from before the crash, and the investigator asked to include both in the estimate – roughly $5,500-worth of damage.

"He was adamant we include the bumper," and the employee included it in the estimate because they were never shown a claim number or insurance card, Hawes said.

Sergio Perez, the owner of USA Auto Collision in La Habra, said he was not guilty of duping insurance companies.

"I don't understand why they arrested me. We write estimates according to what the client tells us," said Perez, 44, who has owned the shop for eight years.

"My record is clean and I do everything professional. This surprised me,'' he added.

Ronald Pierce, the longtime owner of Big Ron's Body and Paint in Garden Grove, said he was arrested around 9:15 a.m. Wednesday in front of his employees and sons.

"I thought it was a prank. They brought four officers to arrest me because of my size," said Pierce, 53, who is 6 feet 5 inches tall and weighs 250 pounds.

"They have not shown us no evidence or what we've done," Pierce said.

Yoon Kyu Choi, an estimator and body technician at Son's Auto Body in Fullerton, said he was arrested Wednesday morning at work.

"It was scary," Choi said. "I'm confused about why I was arrested."

Felipe Gutierrez Gomez, owner of Easy Auto Body in Anaheim, said he likely wrote an estimate, but that he didn't file a claim with any insurance company.

Sergio Rene Gonzalez, who works for Superior Collision Center in Costa Mesa, said he also filled out an estimate.

"I didn't do anything wrong," he said. "We write the estimates regardless whether if it's for insurance or ourselves, we write an estimate."

Gonzalez said he was not shown a claim number or given a name for an insurance company and wrote the estimate in one sheet at the request of the undercover investigator.

To see the list of charged workers and shops they work in, click here.

Arraignments began Thursday and will continue Friday, prosecutors said.

This is the second such sting operation aimed at insurance fraud this week. On Tuesday, county prosecutors said they charged four chiropractors, an attorney and two office employees in an insurance overbilling scheme.

Tuesday, November 2, 2010
 

An Orange County jury took about two hours to return its verdict. Had Smith been convicted, he would have faced up to five years in prison.  Prominent Criminal Defense Attorney Dyke Huish argued that Smith was simply involved in a business deal that failed along with the market crash of 2008. 

Los Angeles Clippers announcer Mike Smith was acquitted of grand theft today in a case resulting from his failure to repay a $735,000 loan to a close friend.

“I’m relieved, obviously, but mostly I’m just grateful to the judge and jury who saw to it (that) the truth came out,” Smith said. “This was a very difficult thing to go through for me and my family.”

Smith failed to repay the loan from his late friend, Bill Steinriede, to help finance a failed real estate deal in Dana Point.

“The debt was never really an issue,” said Smith’s attorney, Dyke Huish. “It was whether he was a thief. And I don’t care what the district attorney says, they were wrong and the jury backed me up.”  Huish made an impassioned closing argument which lasted over three hours. 

What was at issue was whether Smith ever intended to repay the loan when he signed a contract with Steinriede. Deputy District Attorney George McFetridge contended that Smith knew he could not pay back the loan and went through with it anyway.

But the jury accepted Huish’s argument that it was a business deal that no one could have known would go south. Huish said, if anything, the case should have been brought to a civil court, but criminal charges were unwarranted.

Smith said he did not have any criticism of prosecutors who brought the case.

“I’m just thrilled to have this woman by my side,” Smith said as he hugged his wife.

Steinriede died Oct. 5 at age 65. The retired physical education teacher’s videotaped testimony, which was shown to jurors last week, was taken Feb. 5 and March 8 because Steinriede had an inoperable brain tumor.

Smith said he still misses his longtime golfing and surfing buddy.

“I’ve cried many tears for him,” Smith said. “He was my best friend.”

Huish lashed out at the Orange County District Attorney’s Office for prosecuting Smith.

“The District Attorney ought to be more careful,” Huish said. “When a jury comes back with a verdict in less than an hour, more care needs to be given. This was an innocent man since day one.”



Read more: http://www.swrnn.com/southwest-riverside/2010-11-02/sports/l-a-clippers-announcer-mike-smith-acquitted-of-grand-theft-charges#ixzz1DKGAneOO