Toronto towing owner charged with insurance fraud

Toronto, Ontario — November 19, 2014 — Police have laid charges in a case of alleged fraud involving a Toronto-based towing company.

On June 27, 2014, Kam’s Towing & Recovery, located at 50 Shaft Road, responded to a three-vehicle collision in the city’s west end. Aviva Canada, an insurer of one the vehicles involved—a commercial dump truck—received a damage claim totaling $4,250, detailing costs for attendance of a heavy tow truck, clean-up of roadway debris and removal of the dump truck.

The insurance company determined the claim to be false, and presented the findings to the authorities, leading to charges laid against 53-year-old Jainauth Sounauth on Nov. 13.

The towing company owner is charged with False Pretence, Forgery, Uttering a Forged Document and Fraud Under $5,000. Sounauth is scheduled to appear in court on Dec. 19.

Vice President of Aviva Canada’s Anti-Fraud unit Gordon Rasbach says that these types of incidents cast a shadow on the industry, despite the large number of honest, hard-working towing operators in the province.

“Fraud continues to hurt the insurance system, particularly in Ontario,” he says. “Until we start seeing those trying to steal from the system hit with more serious consequences, insurance prices will continue to be higher than in other provinces.”

Rasbach adds that the passing of Bill 15 is a step in the right direction.

“Most major insurers are having a hard look at towing operators as part of their fraud prevention efforts. Historically, the towing industry has not been well regulated,” he says. “Bill 15 – Fighting Fraud and Reducing Automobile Insurance Rates Act—which is currently in the Ontario Legislature—will increase oversight of the towing industry and provide more consumer protection. Aviva Canada urges the Government to pass Bill 15.”

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