CALIFORNIA PENAL CODE 549 PC – REFERRING AUTO INSURANCE FRAUD BUSINESS

Penal Code 549 is a California law that criminalizes the act of referring an individual to an auto repair shop or a shop soliciting business from an individual when either party is aware that a fraudulent auto insurance claim will be made. PC 549 is just one of California’s various statutes targeting auto insurance fraud.

549. Any firm, corporation, partnership, or association, or any person acting in his or her individual capacity, or in his or her capacity as a public or private employee, who solicits, accepts, or refers any business to or from any individual or entity with the knowledge that, or with reckless disregard for whether, the individual or entity for or from whom the solicitation or referral is made, or the individual or entity who is solicited or referred, intends to violate Section 550 of this code or Section 1871.4 of the Insurance Code is guilty of a crime, punishable upon a first conviction by imprisonment in the county jail for not more than one year or by imprisonment pursuant to subdivision (h) of Section 1170 for 16 months, two years, or three years, or by a fine not exceeding fifty thousand dollars ($50,000) or double the amount of the fraud, whichever is greater, or by both that imprisonment and fine. A second or subsequent conviction is punishable by imprisonment pursuant to subdivision (h) of Section 1170 or by that imprisonment and a fine of fifty thousand dollars ($50,000). Restitution shall be ordered, including restitution for any medical evaluation or treatment services obtained or provided. The court shall determine the amount of restitution and the person or persons to whom the restitution shall be paid. Source: https://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?lawCode=PEN&sectionNum=549.

ELEMENTS

Under the California Penal Code 549 PC, the elements of the crime consist of the following:

• The accused solicited, accepted, or referred business to or from an individual or entity.
• The accused knew, or recklessly disregarded whether, that the person or entity will submit a fraudulent insurance claim.
• The accused acted with the requisite criminal intent when committing the act.

It is important to note that any person or entity, including firms, corporations, partnerships, associations, or any person acting in their individual capacity, can be held liable under the provisions of this statute.

EXAMPLE

Suppose an individual knowingly refers a friend to an auto repair shop with the awareness that the shop intends to submit a fraudulent auto insurance claim for unnecessary or exaggerated repairs on the friend’s vehicle. If it can be proven that the individual had knowledge of the fraudulent intent and willingly referred their friend to the shop, they could face charges under Penal Code 549 PC for knowingly referring someone to an auto repair shop with the intention of submitting a fraudulent insurance claim.

PENALTIES, PUNISHMENT, AND SENTENCING

PC 549 is a wobbler offense. It can be charged as either a misdemeanor or a felony. For misdemeanor charges, potential penalties include summary probation, a maximum of one year in county jail, and/or fines reaching up to $1,000. Felony charges, on the other hand, can lead to felony probation, imprisonment in jail for up to three years, and/or a fine of up to $50,000 (or double the amount of the fraud, whichever is greater). Please note that subsequent convictions for violating this car insurance law in California will always be treated as felonies and carry the aforementioned felony penalties.

HOW CAN I FIGHT AUTO INSURANCE FRAUD CHARGES?

When accused of violating PC 549, a party can dispute the accusation by presenting a legal defense. A convincing defense strategy may result in reducing or even dismissing the charges. There are three common defenses to accusations made under PC 549:

• No knowledge of submission: According to the language in Penal Code 549, a person can only be considered guilty if they act with knowledge that a fraudulent insurance claim would be submitted by a person or business. Hence, it is always a legitimate defense for the accused to assert that they did not act with such knowledge.
• Falsely accused: It is a reality that individuals often face unjust prosecution based on false accusations, often motivated by jealousy, revenge, or anger. Consequently, a valid defense for the accused is to argue that they have been falsely accused of violating PC 549.
• Coerced confession: California law prohibits law enforcement from using excessive measures to coerce a confession. If an accused person can provide evidence indicating that the police coerced them into confessing, the confession can be deemed inadmissible in court, or the case can be dismissed entirely if the party was coerced into confessing to a crime they didn’t commit.

IMMIGRATION CONSEQUENCES

Convictions involving fraud or deceit are typically considered crimes involving moral turpitude (CIMTs). CIMTs can lead to deportation or make a non-citizen inadmissible to the U.S. under the Immigration and Nationality Act (INA). If convicted under PC 549, it is likely to be deemed a CIMT due to the fraudulent intent inherent in the crime. While PC 549 is not automatically classified as an aggravated felony, the context and specifics of the case matter. If the crime involves fraud or deceit where the loss to the victim(s) exceeds $10,000, it can be categorized as an aggravated felony under federal immigration law. Convictions classified as aggravated felonies have severe immigration consequences, including mandatory detention and deportation, and barring reentry into the U.S. If you or someone you know is charged with this crime, it is strongly advisable that you also consult with an immigration lawyer. If you do not have or know of an immigration lawyer, the Tabibnia Law Firm can refer you to one.

CAN A DEFENDANT GET A CONVICTION EXPUNGED?

Yes, a defendant can potentially get a conviction expunged under California Penal Code 549 PC, but there are specific conditions and limitations involved:

• The defendant must have successfully completed probation, including all its terms and conditions, such as paying fines, restitution, and completing any community service or counseling programs.
• The defendant must not be facing any new criminal charges, nor be serving a sentence for another offense at the time of the expungement request.
• Generally, expungement under PC 1203.4 is available to those who were sentenced to county jail, probation, or other forms of community supervision. Those who served time in state prison may not be eligible for expungement but may qualify for other forms of post-conviction relief.

It is highly recommended that defendants seeking expungement, especially those who are non-citizens, consult with an expungement attorney to fully understand the implications and ensure all legal requirements are met.

RELATED CRIMES

• Auto insurance fraud by damaging or abandoning a vehicle – California Penal Code Section 548 PC
• Fraudulent auto insurance claims – California Penal Code Section 550 PC
• Kickbacks from auto repair shops – California Penal Code Section 551 PC
• Auto Insurance Fraud – California Insurance Code Section 1872.8 PC
• Petty Theft – California Penal Code Section 484 PC
• Grand Theft – California Penal Code Section 487 PC

SPEAK WITH CRIMINAL DEFENSE LAWYER FROM TABIBNIA LAW FIRM

Auto insurance fraud is categorized as a white-collar crime, which is treated severely in California, despite not involving physical harm to others. If you or someone you know is facing accusations under Penal Code 549 PC, we encourage you to reach out to the Tabibnia Law Firm for a complimentary consultation. Cyrus Tabibnia, a seasoned white-collar crime attorney in Los Angeles with over 19 years of experience in California criminal law, can provide guidance during the initial consultation. Contact him to discuss your case further.