By Oct. 16, an insurance company paid $4,400 for the repair of the vehicle – “including damages to the whole left side that (were) not there before, and with damages as if another car sideswiped said vehicle,” the complaint states.
The auto shop allegedly ran a similar scheme on one of its customers in October 2011—the owner of a 2006 Nissan Titan came in for repairs after hitting a rock at the corner of Lois Street and Howard Avenue with the front of the vehicle.
Dema’s wound up collecting $11,000 in insurance money, at least $3,000 more than the actual repair costs, reporting extra damages to both the front and back of the truck, the complaint alleges.
The tax fraud charges came after a forensic accountant with District Attorney Daniel Donovan’s office reviewed the shop’s records and found that they hadn’t paid more than $50,000 in taxes between 2009 and 2012, the complaint alleges.
Body shops that run “enhanced damage” insurance schemes will often offer to pay a customer’s deductible in exchange for looking the other way when insurance claim includes extra damages, according to a source familiar with fraud investigations.
Too often, though, those customers end up losing out when they look to sell or trade in the vehicle, since those phantom damages end up reducing the car’s Kelley Blue Book value, the source said.
Talat Dema, of Lake Hopacong, N.J., and Argetim Dema, of Allen Place in Annadale, both face multiple felony charges, as does their business, which is being charged as a corporation.
The charges include second-degree grand larceny, third- and fourth-degree criminal tax fraud, and third- and fourth-degree insurance fraud.
Det. Ferdinand Muniz of the NYPD’s Auto Crime Division is credited with the arrest.
Both brothers were arraigned Wednesday in Stapleton Criminal Court and ordered released on their own recognizance until their next appearance Aug. 20.
The shop remained open and busy that afternoon. When asked about the charges, Argetim Dema said, “I think it was a mistake,” but declined to elaborate, saying he’d need to talk to his lawyer.