A bipartisan bill introduced in Congress earlier this month seeks to make staging or fabricating motor vehicle accidents to make fraudulent insurance claims, a federal crime by modifying the federal criminal code. Depending on the seriousness of the case, violators of the new law could be subject up to life in prison when a fraudulent collision results in death.
“Bad actors across the country are deliberately causing, staging and fabricating car wrecks and filing phony insurance claims, and it’s the hardworking American families who end up paying the price with high insurance rates,” said Congressman Nehls. “It’s time we put an end to this, make it a federal crime, and hold these fraudsters accountable. I’m proud to co-lead the bipartisan Stop Auto Fraud Act of 2026 with Congresswoman Gillen to crack down on these scams, put the fines collected into the Highway Trust Fund, which provides the resources to improve our roads, and make our roads safer.”
The Stop Auto Fraud Act of 2026, H.R. 10269, was introduced Sept. 3 by U.S. Rep. Laura Gillen, D-N.Y., with Reps. Troy Nehls, R-Texas; Josh Gottheimer, D-N.J.; and Vince Fong, R-Calif., as cosponsors.
The bill has been referred to the House Judiciary Committee.
Bill Targets Staged Accidents Followed By False Claims
According to an official announcement, the legislation would include a new Section 1353, “Motor vehicle collision fraud,” to Chapter 63 of the federal criminal code.
The proposed offense would apply to any person who knowingly executes or attempts to execute a scheme to cause, stage, fabricate, or simulate a motor vehicle accident to submit a false, fictitious, or fraudulent insurance claim arising from it.
The bill specifically identifies claims involving medical treatment, repair costs, lost wages or lost benefits.
A violation would carry a fine, imprisonment for up to 10 years, or both. If the violation results in serious bodily injury, the maximum prison term would increase to 20 years. If a scheme results in death, the proposed law provides for imprisonment for any term of years or for life, as well as a possible fine.
According to sources, criminal fines collected under the proposed statute would be deposited into the Highway Trust Fund
Insurance Groups Back Federal Legislation
The American Property Casualty Insurance Association, National Insurance Crime Bureau and National Association of Mutual Insurance Companies are among the insurance organizations in support of the proposed legislation.
“Auto claims fraud, including intentional crashes, staged accidents, fabricated medical bills, and AI-altered photo evidence, drives up costs throughout the system and ultimately raises auto insurance premiums for everyone,” said Sam Whitfield, Senior Vice President of Federal Government Relations and Political Engagement, American Property Casualty Insurance Association (APCIA).
“States that have enacted targeted anti-fraud and staged accident reforms have strengthened enforcement, disrupted organized fraud rings, and helped stabilize auto insurance markets, with some states even experiencing premium reductions. We applaud Representatives Gillen, Nehls, Gottheimer, and Fong for introducing the Stop Auto Fraud Act of 2026, which would establish federal criminal penalties for deliberate staged and phantom auto accidents. By giving law enforcement additional tools to combat organized crime fraud, this legislation addresses a significant driver of rising auto insurance claim costs and helps protect consumers from unnecessary premium increases.”
The National Insurance Crime Bureau also cited the potential insurance costs associated with staged accidents.
“Staged vehicle accidents are not harmless property crimes,” said Kyle McCollum, Vice President, National Insurance Crime Bureau. “These are violent offenses that put innocent drivers and pedestrians at risk of injury or worse—all so that fraudsters and their facilitators can cash in. As NICB data and frontline investigations demonstrate, staged accident fraud is on the rise, costly—up to $300 a year in increased premiums—and increasingly organized. And it demands an organized, effective response. NICB applauds Representative Gillen’s Stop Auto Fraud Act of 2026, a bipartisan measure making clear that staged accidents are serious crimes deserving serious consequences.”
NAMIC also announced its support.
“Staged crashes and claims connected to them are a particularly malicious form of insurance fraud,” said Jimi Grande, SVP of Federal and Political Affairs for NAMIC. “Not only do these fraudsters endanger innocent drivers and communities all across the country, they also cause extensive financial harm. NAMIC applauds Representatives Gillen and Nehls, along with their co-sponsors, for their work to combat scammers and protect all honest road users.”
Sponsors Cite Insurance Costs And Public Safety
Commenting on the bill she is co-sponsoring, Congresswoman Gillen said staged accidents impose costs on drivers and pose safety risks.
“Long Islanders pay some of the highest car insurance rates in the country and ‘crash for cash’ schemes on our roads are driving rates even higher,” said Congresswoman Gillen. “When fraudsters stage car wrecks to scam their way to huge payouts, they’re putting lives at risk and forcing responsible drivers to bear the costs. I’m proud to lead this bipartisan bill to hold these criminals accountable, make our roads safer and lower sky-high car insurance costs.”
In addition to APCIA, NICB and NAMIC, organizations listed as supporting the legislation include the American Bus Association, American Trucking Associations, Trucking Association of New York, Texas Trucking Association, Truck Renting and Leasing Association, Southwest Movers Association, National Tank Truck Carriers Association and Truckload Carriers Association.
