Cascade Auto Glass Pleads Guilty to Attempted Insurance Fraud; Allegedly Billed Farmers from Non-Existent Office

May 18, 2010

Cascade Auto Glass, which is based in Vancouver, Wash., has pleaded guilty to attempted insurance fraud for allegedly attempting to bill Farmers Insurance from a non-existent office that actually was just a storage unit located in a rural area, according to the Washington State Insurance Commissioner's office. The commissioner's office had filed a complaint against Cascade in King County (Wash.) Superior Court.

According to Rich Roesler, a spokesperson for the Washington State Insurance Commissioner, Safelite Solutions, acting as glass claims administrator for Farmers, discovered the irregularity.

"Safelite is the one who contacted the insurer to raise the issue," Roesler told™/AGRR magazine.

Farmers was the only company involved in the investigation, according to Roesler.

"That's the only one we investigated," he said. "That doesn't mean that others weren't involved, but in cases like this we typically focus on the biggest company."

Roesler said the state reviewed 3,031 claims filed between June 1, 2000, and November 17, 2008; however, he said he didn't have a breakdown of how many of those were fraudulent.

Though in many past cases auto glass companies have been required to pay restitution to the insurers involved in such cases, in this case, Roesler said it is up to Farmers whether restitution is sought.

"In this case we're going to leave that to the insurer," he said. "That wasn't part of the settlement. If the insurer wants to, they're welcome to go after them civilly."

Roesler said the corporation itself pled guilty to the attempted fraud charge as part of a plea bargain-and therefore weren't charged with actual fraud. The company will pay a $1,000 fine, $500 victim penalty assessment and $200 in court costs.

Officials from Cascade Auto Glass advised™/AGRR magazine in a written statement that the charges were the result of "a long-running dispute with an insurance carrier over pricing and billing practices."

"Cascade originally filed a claim against the carrier for the underpayment of invoices," writes the company in statement provided by Cascade vice president Paul Sharkey. "For quite some time, Cascade and this carrier disagreed with one another about the amounts that should be billed and paid for automobile glass replacement. After many years of litigation, Cascade and the carrier were able to amicably resolve their dispute and conclude the lawsuit that was pending in Clark County Superior Court."

However, company officials say during the course of the suit, the complaint from the insurance commissioner's office arose.

"Although Cascade and the carrier settled the dispute outside of court, the insurance commissioner charged Cascade with a misdemeanor relating to the billing dispute," writes the company. "While we at Cascade firmly believe that we did nothing illegal, we have chosen to plead guilty to the charge in order to put this matter behind us. There is no need for either company to undergo that expense nor is there a need for the taxpayers of Washington to have their financial resources expended in a trial over these issues."

CLICK HERE for full text of statement from Cascade.

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