Louie the Switch
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Posted on April 6, 2022 by Barry Zalma
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Barry Zalma, Esq., CFE presents videos so you can learn how insurance fraud is perpetrated and what is necessary to deter or defeat insurance fraud.
Louie made his living buying and selling used cars in Salt Lake City. He would attend a dealer’s auction and buy a slightly damaged vehicle, take it to a shop, clean it up, paint it and sell it to downtown dealers.
Fifty cars would go through Louie’s hands every month. He made a relatively good living clearing between $500 and $2,000 on each transaction. Louie was greedy. The Switch had no moral character. Louie was dishonest. If he could make an extra $1000 on a sale by turning back the odometer 10,000 miles, he turned it back. If he could sell a car for an extra $1000 by rubbing grease on the seams where the repairs from an accident had been done, he crawled under the car and spread the grease.
Everyone liked Louie. He was a friendly sort. Louie had no trouble making friends. Everyone at the auto auction knew him. Louie was a professional. He only bought used cars that he could make look good and sell. He never bought bad cars. The Switch always paid for his purchases in cash.
If Louie had a weakness, it was skiing. Every winter he would drive from Salt Lake to the mountains of Utah and ski. He owned a condo in Park City which he used when he did not have a tenant for the condo.
A FRAUD IS BORN
What he saw as the need for the dream cabin drove Louie to crime. One of his acquaintances, a tow truck operator, told him that a lien sale for storage charges was about to happen on a four-wheel drive crew cab Chevy pickup that Louie could buy for $250. The pickup had been declared a total loss by the insurance company after it was driven head-on into a sixteen wheeler while going the wrong way on the interstate. Louie already had in his inventory a four-wheel drive Chevy crew cab. His mind began to spin with devious criminal thoughts.
THE FRAUD FAILS
The insurance company investigator was ready to pay Louie the full stated value on the policy until he received a declaration of total auto theft from Louie. Louie represented in the declaration that the truck had an automatic transmission and a gasoline engine. The investigator knew, from his experience with vehicle identification numbers, that the VIN number identified this truck as having a five-speed standard transmission and a diesel engine. He was confused.
The investigator then searched the National Insurance Crime Bureau (NICB) computer for information on the vehicle. The computer informed the investigator that the vehicle had been in a major automobile accident only thirty (30) days before Louie insured it. The vehicle had been declared a total loss by its insurer. NICB obtained a copy of the prior insurer’s file, including photographs showing the total destruction of the vehicle.
Luck, a knowledgeable adjuster, the massive database maintained by the National Insurance Crime Bureau and the resourcefulness of DMV investigators stopped an almost perfect crime.
When news of Louie’s arrest, conviction and sentence reached the auto market reported thefts in the Salt Lake City area dropped 10% for the next six months.
ZALMA OPINION
Although insurance fraud seems an easy and safe crime to pursue it is still a crime and failure to effectively pursue a fraudulent claim can result in prison. This case explained to the public that fraud is not worth the effort when it can result in jail.
(c) 2022 Barry Zalma & ClaimSchool, Inc.
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 practiced law in California for more than 44 years as an insurance coverage and claims handling lawyer and more than 54 years in the insurance business. He is available at http://www.zalma.com and [email protected].
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Anti-Public Adjuster Clause Is Effective in New York
Post number 5301
Read the full article at https://www.linkedin.com/pulse/public-adjusters-attempt-represent-insured-subject-zalma-esq-cfe-rubfc, see the video at and at and at https://zalma.com/blog plus more than 5300 posts.
Insurers May Contractually Prevent an Insured from Hiring a Public Adjuster
In Peter Barbato & North Jersey Public Adjusters Inc. v. Interstate Fire & Casualty Company, et al, No. 25-cv-5312 (JGK), United States District Court, S.D. New York (December 15, 2025) the plaintiffs, Peter Barbato and North Jersey Public Adjusters, Inc. (“NJPA”), filed suit against several insurance companies, including Interstate Fire & Casualty Company, Independent Specialty Insurance Company, and certain Underwriters at Lloyd’s of London.
FACTS
NJPA is a New Jersey-based public adjusting firm licensed in New York. The dispute centers on ...
Anti-Public Adjuster Clause Is Effective in New York
Post number 5301
Read the full article at https://www.linkedin.com/pulse/public-adjusters-attempt-represent-insured-subject-zalma-esq-cfe-rubfc, see the video at and at and at https://zalma.com/blog plus more than 5300 posts.
Insurers May Contractually Prevent an Insured from Hiring a Public Adjuster
In Peter Barbato & North Jersey Public Adjusters Inc. v. Interstate Fire & Casualty Company, et al, No. 25-cv-5312 (JGK), United States District Court, S.D. New York (December 15, 2025) the plaintiffs, Peter Barbato and North Jersey Public Adjusters, Inc. (“NJPA”), filed suit against several insurance companies, including Interstate Fire & Casualty Company, Independent Specialty Insurance Company, and certain Underwriters at Lloyd’s of London.
FACTS
NJPA is a New Jersey-based public adjusting firm licensed in New York. The dispute centers on ...
Proof of Highly Contaminated Water is Required for Extra Payments
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Acting as Your Own Lawyer is Foolish
Evidence of Breach of Contract Survives Dismissal of All Other Charges
In Lee Lifeng Hsu and Jane Yuchen Hsu v. State Farm Fire And Casualty Company, C. A. No. N24C-09-020 CLS, Superior Court of Delaware (February 27, 2026) a claim to State Farm who paid approximately $61,000 after assessments but denied coverage for additional items including ceramic tiles, the kitchen floor ceiling, underlayment plywood, and numerous personal property items resulted in suit by the Hsu’s acting in pro per.
Facts
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Insurance Condition Requires Following the Intent of the Parties
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Principles of Contract Interpretation Compels Reading Contract as Written
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In Eastside Floor Supplies, Ltd. v. SCS Agency, Inc., Hanover Insurance Company, et al., No. 2024-01501, Index No. 609883/19, 2026 NY Slip Op 01488, Supreme Court of New York, Second Department (March 18, 2026)
In May 2019, a fire damaged business personal property belonging to the plaintiffs, which was stored in portable storage containers at their Manhattan premises. At the time of the fire, the plaintiffs were insured under a businessowners insurance policy (BOP) issued by the defendant Hanover Insurance Company which provided general coverage for business personal property, and which included a specific extension for “Business Personal Property Temporarily in Portable Storage Units” (the portable storage ...
ERISA Saves Fraudulent Claims Suit
Post number 5306
Read the full article at https://www.linkedin.com/pulse/failure-provide-well-pled-facts-defeats-most-action-zalma-esq-cfe-b4zuc and at https://zalma.com/blog plus more than 5300 posts.
Allegations of Fraudulent Insurance Billing Must be Pleaded with Specificity
In Genesis Laboratory Management LLC v. United Healthcare Services, Inc. and Oxford Health Plans, Inc., No. 21cv12057 (EP) (JSA), United States District Court, D. New Jersey (March 13, 2026) Genesis Laboratory Management LLC (“Genesis”), a New Jersey-based molecular diagnostic and anatomic pathology laboratory, provided COVID-19 related testing services and submitted claims for reimbursement as an out-of-network provider to United Healthcare Services, Inc. (“United”) and Oxford Health Insurance, Inc. (“Oxford”). Metropolitan Healthcare Billing, LLC (“Metropolitan”), owned by the same individual as Genesis, handled the billing for Genesis.
FACTUAL BACKGROUND
United and Oxford, who administer both ERISA and ...
ERISA Saves Fraudulent Claims Suit
Post number 5306
Read the full article at https://www.linkedin.com/pulse/failure-provide-well-pled-facts-defeats-most-action-zalma-esq-cfe-b4zuc and at https://zalma.com/blog plus more than 5300 posts.
Allegations of Fraudulent Insurance Billing Must be Pleaded with Specificity
In Genesis Laboratory Management LLC v. United Healthcare Services, Inc. and Oxford Health Plans, Inc., No. 21cv12057 (EP) (JSA), United States District Court, D. New Jersey (March 13, 2026) Genesis Laboratory Management LLC (“Genesis”), a New Jersey-based molecular diagnostic and anatomic pathology laboratory, provided COVID-19 related testing services and submitted claims for reimbursement as an out-of-network provider to United Healthcare Services, Inc. (“United”) and Oxford Health Insurance, Inc. (“Oxford”). Metropolitan Healthcare Billing, LLC (“Metropolitan”), owned by the same individual as Genesis, handled the billing for Genesis.
FACTUAL BACKGROUND
United and Oxford, who administer both ERISA and ...
