Eight referred to prosecutors for insurance fraud involving staged car crashes

A gang of alleged insurance fraudsters was booked by police for deliberately staging traffic accidents using temporarily repaired high-end imported cars.

A vehicle is seen crashed into another during a scene of a staged traffic accident by a group of people who deliberately arranged such accidents for insurance money [DAEJEON METROPOLITAN POLICE AGENCY]

A gang of alleged insurance fraudsters was booked by police for deliberately staging traffic accidents using temporarily repaired high-end imported cars.

The Daejeon Metropolitan Police Agency referred eight people, including the primary suspect, without detention to the prosecution for violating the Special Act on Prevention of Insurance Fraud, the agency said Thursday.

The primary suspect and accomplices are accused of deliberately causing five traffic accidents between September 2019 and May 2024, defrauding three insurance companies out of a total of 300 million won ($204,400), according to police.

Investigators found that the suspect, a former insurance company employee, had opened an auto repair shop that also operated as an insurance agency. The suspect purchased high-end imported cars that had been declared total losses in accidents through auctions, then carried out partial exterior repairs.

The cars were then placed on roads, where the suspect staged deliberate traffic accidents with coconspirators to claim insurance payouts.

The suspect recruited accomplices and, to avoid drawing suspicion from insurers, moved around various regions — including Daejeon, South Chungcheong and Gyeonggi — over an extended period while committing the fraud, police said.

The money obtained from the insurance companies was entirely spent on living expenses. None of the suspects had prior convictions for insurance fraud involving traffic accidents.

A vehicle is seen damaged from a crash at a scene of a staged traffic accident by a group of people who deliberately arranged such accidents for insurance money [DAEJEON METROPOLITAN POLICE AGENCY]

Vehicles used in the scheme included high-end imports such as BMWs, Maseratis and Teslas, as well as a camper van, a popular choice in recent years.

In one incident in September 2024, a BMW and a camper van were involved in a staged collision, leading to a payout of 120 million won from the insurer. The impact destroyed both vehicles, and the suspects involved in the crash suffered serious injuries and were hospitalized.

The investigation began after an insurance company reported suspicious activity. Police booked all eight suspects and confirmed the criminal charges.

“This is a textbook example of staged traffic accident fraud orchestrated by a former insurance company employee,” said a Daejeon police spokesperson. “We plan to strictly enforce the law to prevent innocent citizens from bearing the burden of insurance fraud.”

This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom. BY SHIN JIN-HO [lim.jeongwon@joongang.co.kr]