US public take bus firms for expensive ride

WASHINGTON - When state regulators in New Jersey decided to mount a 'sting' in an effort to prove that the public were making fraudulent insurance claims, they expected to uncover some skulduggery. But the scale must have raised the eyebrows of the most seasoned investigator, writes Phil Reeves.

The sting, operated over three years, involved equipping 10 public buses with video cameras, and deliberately crashing them while agents posing as passengers looked out for impostors. The results have uncovered what was described by one investigator yesterday as symptoms of a 'multi-billion dollar fraudulent cottage industry'.

One such 'crash' involved a bus carrying 15 passengers, all in on the secret, which was hit at low speed from behind by a car. No fewer than 17 people were caught on film flocking to the scene and scrambling aboard, all of whom later filed claims against the bus company's insurers. Although they boarded in excellent spirits, several of the so-called 'ghost riders' were videotaped climbing off with pained expressions and pronounced limps. Two more people claimed - without even bothering to board.

Investigators say that among the throng taking part in the modern-day gold rush are a group known as 'runners', freelance agents acting for corrupt lawyers and doctors. Using police radio scanners, beepers and portable phones, they locate the site of public transport accidents and race to the scene, handing out business cards and urging people to stake claims for neck and back injuries - which are hard to disprove. If the police are slow to arrive, they sometimes pose as passengers themselves. The con has become so commonplace that in some inner-city areas, opportunistic members of the public spontaneously board crashed vehicles, knowing the driver will be too scared, indifferent, or shocked to intervene.

Investigators from the New Jersey Department of Insurance, which headed the operation, were particularly astonished when a genuine crash resulted in an avalanche of claims. It happened when a truck and a car collided behind a bus. The concerned bus driver stopped to see if anyone needed assistance. Assuming that the bus was also hit, 27 passengers promptly fired off claims.

Officials have begun legal proceedings against 107 people - including 72 'passengers', 21 runners, nine physicians and four lawyers. Investigators found cases in which doctors treated fraudulent passengers for non- existent injuries, and filed claims for costs - padded out with non-existent appointments.

It is estimated that at least dollars 1.3bn ( pounds 866m) paid out annually in medical bills for vehicle accidents are for bogus claims.