Wednesday, September 9th, 2026 — A bipartisan group of House lawmakers has introduced legislation that would make staged motor vehicle collisions tied to fraudulent insurance claims a specific federal crime, potentially giving investigators and prosecutors another avenue for pursuing organized auto fraud schemes.
Reps. Laura Gillen, D-N.Y., Troy Nehls, R-Texas, Josh Gottheimer, D-N.J., and Vince Fong, R-Calif., introduced the Stop Auto Fraud Act of 2026 on Sept. 3. The proposal would add a motor vehicle collision fraud offense to Chapter 63 of Title 18 of the U.S. Code. Gillen and Nehls announced the measure as an effort to address schemes involving deliberately caused, staged or fabricated crashes and subsequent false insurance claims.
Under the bill, a person who knowingly executes or attempts a scheme to cause, stage, fabricate or simulate a motor vehicle accident and submits a false, fictitious or fraudulent insurance claim could face a fine, up to 10 years in prison, or both. The legislation specifically identifies losses involving medical treatment, vehicle repairs, lost wages and lost benefits.
Penalties would increase when a fraudulent collision scheme causes physical harm. A violation resulting in serious bodily injury could carry a prison sentence of up to 20 years. If a violation results in death, the bill would permit imprisonment for a term of years or for life. Fines collected under the proposed offense would be deposited into the federal Highway Trust Fund.
The lawmakers cited the financial effect of auto insurance fraud as part of their case for the legislation. Gillen’s office said staged accidents and related insurance fraud can cost families as much as $300 annually in higher premiums, citing Insurance Information Institute data. Her office also reported that insurers submitted 38,270 suspected motor vehicle insurance fraud incidents to the New York State Department of Financial Services in 2023, up 58% from 2020. Those figures are presented by Gillen’s office in support of the proposal and do not appear in the three-page bill itself.
The proposal has backing from insurance and transportation organizations, including the National Insurance Crime Bureau, American Property Casualty Insurance Association and National Association of Mutual Insurance Companies. Several trucking and passenger transportation groups also support it. APCIA identified intentional crashes, fabricated medical bills and AI-altered photographic evidence among the types of auto claims fraud affecting insurers.
For claims organizations, the legislation is notable because its proposed offense reaches both the collision and the insurance claim that follows. The statutory language specifically identifies several loss categories familiar to adjusters, including medical treatment, repair costs and wage or benefit losses. If enacted, suspected staged collisions meeting the federal statute’s requirements could carry criminal exposure separate from state insurance-fraud laws. The bill text provided does not specify new investigative duties, reporting requirements or evidentiary standards for insurers or adjusters.
Florida, Louisiana and New York have recently enacted measures addressing staged-accident activity, according to Gillen’s office. The federal proposal would create a nationwide criminal provision rather than replace those state laws.
