Auto Insurance Fraud Ring Broken Up, Authorities Say : Crime: Officials say the group recruited help among gamblers at card clubs. More than $50 million in phony claims may have been collected.

A group of con artists who recruited patrons at Southland card clubs to stage as many as 3,000 phony auto accidents and collect more than $50 million in false insurance claims has been broken up, officials said Thursday.

“We’re telling the gamblers who defrauded the state of California . . . and the people who recruited them . . . ‘You’ve rolled your last dice; you’ve crapped out,’ ” state Insurance Commissioner John Garamendi said.

Thirty-seven suspects in the so-called “Casino Ring” had been arrested by Thursday afternoon, and Los Angeles County Dist. Atty. Ira Reiner said at least seven more arrests were expected. Four of the defendants were arraigned Thursday afternoon, with the rest scheduled for arraignment by May 11. Bail for the purported ringleaders was set as high as $1 million.

All of those arrested were ringleaders, recruiters, ring members who planned and staged phony accidents or people who submitted phony claims, according to Deputy Dist. Atty. Elizabeth Delgado.

She said none of the recruited gamblers, who provided only their names and auto insurance policies, have been charged or arrested.

Reiner estimated that false accident claims leading to insurance company payouts for faked injuries and phony property damage now account for about half of every auto insurance premium dollar paid by drivers in the county.

“Auto insurance fraud costs California consumers about $500 million each year in direct costs, and as much as $1 billion when indirect costs are included,” Garamendi told a joint news conference with Reiner and California Highway Patrol Commissioner Maury Hannigan at the CHP regional office on Vermont Avenue.

The scheme could not have worked without the help of doctors and lawyers, Reiner said, but none have been arrested, although search warrants have been served at several offices.

“Proving that doctors and lawyers are in on the scheme is the hardest part of these cases,” the district attorney said. “They are always carefully insulated from the dirty work--like the big boys at the top of narcotics rings. . . .

“You can only get to them by working up through the ranks, one layer at a time--like peeling an onion,” Reiner said. “Rings like this one would quickly collapse without a supply of sleazy doctors and lawyers eager to line their own pockets at the public’s expense.”

While the district attorney did not reveal the alleged role of most of the suspects, he did say that one--Madeleine Agirian, 27--worked as an office administrator for a Los Angeles doctor while another--Angela Sarkissian, 25--was employed as an office assistant for a Los Angeles attorney.

A third defendant is Hakop Semerdjian, 37, also known as Hakop Seridzhyam, who investigators allege had links to a Hollywood auto body shop involved in several of the staged auto accidents.

Delgado said that while some of those arrested are related to one another, most are not.

“We’re not talking about one big family, we’re talking about one big ring,” she said.

Reiner said the Casino Ring got its name because the ringleaders stationed recruiters outside the big poker clubs in the Los Angeles area.

“Knowing that the heavy losers at the table would be looking for quick cash, they paid recruits $1,000 apiece--cash on the barrelhead--to use their identification and insurance policy information in staging accidents,” the district attorney said.

Over the course of about two years, he said, about 100 people--ranging in age from 16 to mid-80s--were recruited at the Commerce Club in Commerce, the Bicycle Club in Bell Gardens, Club Bell in Bell, the Normandie Club in Gardena and the Huntington Park Casino in Huntington Park.

“The recruiters took their names and their policy numbers and said goodby,” Delgado said.

Using this documentation, she said, the ring would tell the insurance company a story, typically that the policyholder had broadsided another car containing three passengers. A member of the ring would recruit phony passengers in the car that was said to have been hit, and they would report to cooperative doctors and lawyers to submit claims for injuries and property damage.

“Typically, about $40,000 in claims would be made per accident,” Reiner said. “Insurance companies would then settle by paying roughly $20,000.”

The district attorney said one member of the ring had 513 such “accidents” listed in his notebook.

Officials said they learned about the ring in May, 1989, after one of the recruiters approached a security guard at the Commerce Club, who notified the CHP. Over the next six months, investigators said, the ring was infiltrated with undercover officers.

From information gained by the officers, Reiner said, investigators estimate that the ring staged between 2,000 and 3,000 phony accidents over a 3 1/2-year period.

The investigation was carried out under the direction of the CHP. Also participating were the state Department of Insurance’s fraud bureau, the district attorney’s office, the Los Angeles Police Department, the South Gate Police Department, the U.S. Postal Service, Farmer’s Insurance Co., Geico Insurance, Nationwide Insurance and the Commerce Club.