WASHINGTON — The crashes may be staged, but the criminal consequences could soon be very real.
Long Island Rep. Laura Gillen is targeting fraudsters accused of deliberately causing car accidents with unsuspecting motorists in an effort to collect insurance payouts.
Gillen (D-NY) introduced the Stop Auto Fraud Act of 2026 on Thursday, a proposal that would turn so-called “crash for cash” schemes into a federal crime carrying penalties of up to 10 years in prison. The bill would also allow tougher sentences when staged collisions result in injury or death.
“This is a tough-on-crime, lower-cost bill that is responding to the surge we’ve seen in these crash for cash schemes that are being perpetrated by hucksters and fraudsters across our country, including on Long Island, that are driving up our auto insurance rates and putting drivers’ lives at risk,” Gillen told The Post.
“I think this is a no-brainer. There should be broad bipartisan support to crack down on this crime and to make our roads safer and lower costs.”
The bipartisan legislation is backed by Reps. Troy Nehls (R-Texas), Josh Gottheimer (D-NJ) and Vince Fong (R-Calif.). Under the measure, fines collected from convicted “crash for cash” participants would be directed to the federal Highway Trust Fund.
New York motorists already face steep costs, paying an average of $3,492 a year for car insurance — more than $1,000 higher than the national average, according to a Forbes report published in July.
Gillen’s office cited data showing that insurance fraud and staged collisions can add more than $300 a year to the auto insurance bills of drivers across the Empire State.
“It’s not just the actual accidents themselves and the damage to the vehicles. It’s also about claims for injuries, for treatments, and in some of these fraud cases, people were getting unnecessary surgery just to make their damages go higher, and so it’s cracking down on all of that,” Gillen explained.
If a staged accident causes serious bodily injury, convicted fraudsters can face up to 20 years behind bars, or life if the crash causes a death.
Gillen was joined in rolling out the bill by Nicholas Díaz-Baquero, a Garden City Uber driver who suffered a back injury in what he suspects was a staged crash.
“We both had our left signals on to turn, and there was no traffic in front of us,” he recounted. “Suddenly, the vehicle ahead stopped for no apparent reason, and a driver coming from behind at a very high speed slammed into both of us. I had no chance to avoid it.
“It’s frustrating and heartbreaking that honest drivers can be put in this position just trying to make a living.”
Last month, Jaime Huiracocha, 53, and Victor Murillo, 34, copped to insurance fraud after staging three accidents in August and October 2024 that netted their crew more than $80,000 in insurance payouts.
“We’ve seen a pretty significant increase in this form of fraud in recent years,” said Kyle McCollum, vice president of government affairs at the National Insurance Crime Bureau (NICB). “It’s becoming a very lucrative and attractive form of auto insurance fraud for organized actors out there.
“It is a highly organized type of crime, and I think it compels a very organized response.”
According to NICB data, reports of staged accidents have increased by 35% across the US between 2024 and 2025, and 52% over the first half of this decade.
DC has the highest rate of confirmed staged crashes in America at 19.79 per 100,000 residents, followed by California (13.18 per 100,000 residents) and New York (11.61 per 100,000).
“It sends that signal from the top down that we’re not going to stand for this type of fraud,” McCollum said of the House legislation. “I think it also provides an additional tool for federal prosecutors. Historically, they’ve had to prosecute this form of fraud more under the wire fraud statute.
“So this actually clarifies and makes abundantly clear that staging a motor vehicle accident itself is a federal crime.”
