A Video Explaining Insurance Fraud by “Staged” Losses


The Staged Loss

See the full video at https://youtu.be/qf-ZGRwQ8sc

Some losses are fictions created for the sole purpose of presenting a claim like those engaged in by convicted attorneys in my book, Insurance Fraud, Volume I. The number of variations on types of staged losses are limited only by the imagination of the insurance criminals. Some of the variations follow:


Staged Theft.

A staged theft occurs when “the owner contracts with an intermediary to dispose of a vehicle. The owner ‘gives up’ the vehicle and then reports it to the insurer as stolen.” The person to whom the vehicle is given up will pass it to a salvor who breaks it up into its component parts and sells the parts (a “chop shop.”)

The staged theft is difficult to detect unless the perpetrator is sloppy, aggressive or forgets his prepared script as to the loss facts. For example, in United States of America v. Rocky Glen Beasley, No. 11-30228 (5th Cir. 10/27/2011) Rocky Glen Beasley was convicted by a jury of wire fraud and conspiracy to commit wire fraud. He was sentenced to one year and one day of imprisonment and a two-year term of supervised release.

Beasley’s convictions stem from the staged theft of his Ford F-150 pickup truck by Stephen Yates. According to the evidence adduced at trial, Beasley and Yates prearranged the staged theft of Beasley’s truck. Overwhelming evidence required the conviction to be affirmed,

A staged theft of an automobile performed to defraud an insurer is a crime and can be punished in federal and state courts. Rocky Glen Beasley was unfortunate enough to be tried and convicted in federal court where fraud convictions bear definite sentences.


The owner abandons a vehicle on a city street or in a parking lot, creating a morale hazard where the car will usually be stolen. The insured will report the vehicle stolen and attempt to collect from an insurer before the vehicle is recovered.


“[T]he owner disposes of a vehicle by dumping it into a lake or other body of water.” Cars have even been found buried underground and some lakes have been found to have more than 50 cars underwater.

© 2020 – Barry Zalma

Barry Zalma, Esq., CFE, now limits his practice to service as an insurance consultant  specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders. He also serves as an arbitrator or mediator for insurance related disputes. He practiced law in California for more than 44 years as an insurance coverage and claims handling lawyer and more than 52 years in the insurance business. He is available at http://www.zalma.com and zalma@zalma.com.

Mr. Zalma is the first recipient of the first annual Claims Magazine/ACE Legend Award.

Over the last 52 years Barry Zalma has dedicated his life to insurance, insurance claims and the need to defeat insurance fraud. He has created the following library of books and other materials to make it possible for insurers and their claims staff to become insurance claims professionals.

https://zalma.com/zalmas-insurance-fraud-letter-2/Read last two issues of ZIFL here. 

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Go to the Insurance Claims Library –https://zalma.com/blog/insurance-claims-library/

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