N.Y. Man Arrested in Illegals' Auto Scam

The New York State Insurance Department has arrested the operator of a Delaware County junk yard for fraudulently insuring cars that he then reportedly registered for undocumented immigrants without drivers licenses. William Hrazanek, 61, of the Village of Fleischmanns, near Middletown, was arrested and charged with insurance fraud and offering a false instrument for filing. He could be sentenced to up to 15 years in prison if convicted. Hrazanek is accused of fraudulently providing insurance and auto registrations for used cars with high mileage that he sold to unlicensed drivers. In some cases, Hrazanek is alleged to have provided insurance and registrations for used cars that unlicensed drivers purchased elsewhere and brought to him. Police identified the unlicensed drivers as undocumented immigrants living mostly in Delaware and Ulster counties. Under New York State law, only U.S. citizens or legal residents may apply for driver’s licenses and applicants must have valid Social Security cards. Investigators said none of the individuals had Social Security cards. Authorities said the cars were improperly added as “garage vehicles” to an insurance policy written under the name of Hrazanek’s business, Rabbit City, a salvage yard in Fleischmanns. A “garage vehicle” policy is intended to provide insurance for vehicles used by employees in or near a business, such as a car lot. Hrazanek allegedly charged buyers $1,800 a year per vehicle for the fraudulent insurance and registrations. Hrazanek paid $30 to add the vehicles under his Rabbit City umbrella policy, Howard said. He said it is estimated Hrazanek may have collected as much as $30,000 a year from the fraudulent insurance and registration sales. Investigators said no title transfers occurred when autos were sold. Investigators said it is believed 40 vehicles were fraudulently insured and registered. The cars were later traced to locations such as Buffalo and New York City. One of the vehicles, they said, was being used as a cab. In another case, Hrazanek is accused of leasing a vehicle to an unlicensed driver. The alleged scam occurred during a four-year period. Hrazanek’s insurance company, American Transit Insurance, calculated their premium loss for 40 vehicles over that span of time at $522,823.