Motorcycle Insurance Fraud

Supposedly 10 cents of every $1 in insurance premiums goes toward payment of fraudulent claims. So, all my readers being honest, we all pay 10% more that we should to insure our motorcycles.

John Egan, a reader who is the Managing Editor of, forwarded to me the story of Peter Jay Raposa of Ellenboro, North Carolina who in 2006 allegedly buried his 2005 custom Harley-Davidson on his property, then filed a claim for stolen motorcycle with his insurance company Nationwide. Claim was settled with a $25,000 payment to the lien holder, First Citizens Bank in North Carolina, and a $4,000 payment to Raposa.

Bad luck or Karma: 6 years later, the new owner of the property where he lived is having grading work done and the hired contractor discovers the buried custom motorcycle. Jay Raposa now faces one count of insurance fraud. Frank Scafidi, a spokesman for the nonprofit  National Insurance Crime Bureau, says cases like this are called “owner give-up”: a policyholder reports a vehicle stolen and files an insurance claim, but the owner is actually the one who “stole” the vehicle. Often, the owner just drive the vehicle to a desolate location and set it on fire, or ride into a lake, quarry or canal hoping it will never be found,  or “sell” the parts to a chop shop. Burying a motorcycle is considered quite rare, but insurance companies have known cases where vehicles as large as a 8-ton cotton picker have been buried by people suffering financial setbacks and desperate for cash. Conclusion, watch out. Insurance fraud evidence can be unearthed.

8 Responses to “Motorcycle Insurance Fraud”

  1. 1 bigitch Mar 28th, 2012 at 1:06 pm

    what a idiot. he could have taken the bike somewhere else and got paid and if they found it then it would have been hard to tie it back to him. or he could have sold it off in parts and no one would know. but it appears he needed to get the debt off his record, and in his stupidity has now created a police record.

    but then again look where he’s from…

  2. 2 EvoJoe Mar 29th, 2012 at 6:47 am

    Maybe a metric would be a smarter choice.

  3. 3 Lyle Mar 29th, 2012 at 10:25 am

    Was it a “digger?”

  4. 4 Ronnie Mar 29th, 2012 at 10:30 am

    Lyle. Ha, ha, ha. A very good one!

  5. 5 Vince Mar 29th, 2012 at 8:25 pm

    I have worked at a dealership for years and have seen 100s of fraud cases. People bring a bike in that has been crashed, we estimate it and the insurance oks the fix. They pick up the bike and request the parts back. A couple days/weeks pass and another bike will come in with crash damage. I inspect the parts and notice they are ones from another bike since I etch the vin on the inside of the parts. I usually the insurance company and we go over the bike further. The crashed parts will be dirty, the rest of the bike is usually clean.

    Another one is to strip the bike, take the carcass to a ghetto neighborhood and it will be picked up and they are paid out for it. They buy back the remains or have a friend buy the remains at the auction, take it home and they rebuild it back to being ride able pocketing the balance.

    Those are the popular two. In these days there is always going to be people struggling for cash, its up to us to report fraud and try to curb the big payouts. We all pay too much for insurance now, why pay more just because someone is a cheat.

  6. 6 Smittydog Mar 30th, 2012 at 6:38 pm

    The guy deserves what he gets. Jail i hope.

  7. 7 CoppellDarryl Apr 2nd, 2012 at 10:58 am

    Obviously he should of dug deeper…….

  8. 8 Jim Jul 11th, 2012 at 11:50 am

    Ok, so 10% of all premiums collected go to fraud payouts. How much would you venture to guess of premiums collected go towards marketing costs? A huge, huge number.

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