Feds charge San Francisco towing company operator, others with insurance fraud
A controversial owner of several towing companies in San Francisco has been charged again by federal prosecutors with insurance fraud, three weeks after a similar case, along with other various criminal complaints, was filed against him.
In a statement Wednesday, the U.S. Attorney's Office for the Northern District of California said that towing company operator Jose Vicente Badillo -- along with co-defendants Kirill Afanasyev, Jason Naraja, and Jaime Respicio -- were charged in an indictment with various crimes related to two schemes to defraud auto insurance companies.
Based on the indictment returned by a federal grand jury on Aug. 20, San Francisco residents Afanasyev and Badillo, and Pleasant Hill resident Respicio conspired to defraud a car insurance company by filing a hoax insurance claim on a wrecked car that Afanasyev bought in May 2019. When Afanasyev bought the car, it was allegedly not drivable with serious front-end damage.
Based on the indictment, Respicio obtained an insurance policy and took title to the car before Afanasyev, posing as Respicio, falsely reported to the insurance company in August 2019 that Respicio had been in a single-car crash in it in San Francisco.
Afanasyev allegedly made fake statements and misrepresentations to the insurance company, which sent Respicio an insurance reimbursement check for $47,856.34. Federal prosecutors said Badillo agreed to falsely document that his towing company had towed the wrecked car from the purported crash location. This was their first insurance fraud scheme, according to the U.S. Attorney's Office.
Federal prosecutors said Afanasyev, Badillo, and Hayward resident Naraja then allegedly engaged in a second conspiracy and scheme to defraud another insurance company by submitting a fake insurance claim regarding a crash involving multiple vehicles that Badillo had allegedly staged in San Mateo County.
Badillo and Afanasyev allegedly planned the staged crash in which the towing company operator loaded a vehicle carrier with four vehicles -- most of which were undriveable or had pre-existing damage -- and purposefully drove them off the road on Guadalupe Canyon Parkway in San Mateo County in August 2019.
Federal prosecutors said Badillo reported this crash to his insurance company, and along with Afanasyev, Naraja and another individual, made hoax or misleading statements to an insurance company representative. The insurance company reportedly denied Badillo's claim as a hoax but paid one of his towing companies $5,210 for its recovery, towing and storage of vehicles involved in the staged crash.
Authorities said that at the time of the alleged offenses in 2019, Badillo owned or controlled at least two companies engaged in the business of towing vehicles: Jose's Towing LLC and Auto Towing LLC, both of which operated out of San Francisco.
In the first conspiracy and scheme to defraud case, Afanasyev, Badillo and Respicio are charged with one count each of conspiracy to commit mail fraud and wire fraud, mail fraud, and wire fraud. Afanasyev and Respicio are also charged with one count of money laundering.
In the second similar case, Afanasyev, Badillo and Naraja are each charged with one count of conspiracy to commit wire fraud, and four counts of wire fraud.
Naraja and Respicio were arrested in Hayward and Pleasant Hill, respectively, on Tuesday, and were released on $50,000 bonds at their initial appearances on Wednesday. Prosecutors said Naraja is scheduled to appear in court on Thursday at 10:30 a.m., while Respicio will also appear in court on Sept. 5 for arraignment and identification of counsel.
Badillo, who was previously arrested and made his initial appearance in another fraud case on Aug. 8, is set for arraignment and identification of counsel in both cases on Friday at 10:30 a.m.
The U.S. Attorney's Office said that if convicted, Afanasyev, Badillo and Respicio each face a maximum sentence of 20 years in prison, and a fine of $250,000 or twice the gross gain or loss, whichever is greater, plus restitution, if appropriate, on each of counts 1 through 3, which charge mail fraud, wire fraud, and conspiracy to commit the same.
Afanasyev and Respicio face a maximum sentence of 10 years in prison, and a fine of $250,000 or twice the amount of criminally derived property involved in the transaction, whichever is greater, plus restitution, if appropriate, on count 4, which charges money laundering.
Afanasyev, Badillo, and Naraja each face a maximum sentence of 20 years in prison, and a fine of $250,000 or twice the gross gain or loss, whichever is greater, plus restitution, if appropriate, on each of counts 5 through 9, which charge wire fraud and conspiracy to commit the same.
Last August, San Francisco City Attorney David Chiu initiated debarment proceedings against Auto Towing, and in February they were officially prohibited from bidding on or receiving city contracts. In June, Chiu announced the ban on receiving city contracts would remain for the next five years.
Badillo also co-owned another towing business in San Francisco between 2018 and 2023, Specialty Towing and Recovery. All of his towing companies reportedly generated over $2 million in gross annual income.
Chiu's office said Badillo was debarred for illegally towing cars of vulnerable individuals from a private commercial parking lot, limiting the times vehicles could be retrieved, and pressuring vehicle owners to pay in cash.
San Francisco prosecutors have previously charged him with participating in a fraud scheme. Last October, Chiu's office charged Badillo and his partner Abigail Fuentes with multiple felonies stemming from an alleged welfare fraud.
According to Chiu, Fuentes and Badillo allegedly lied about their substantial income and assets to receive public benefits they were not eligible for. Both suspects received benefits under Medi-Cal, and Fuentes received additional benefits from CalFresh and CalWORKs, prosecutors said.