The U.S. Department of Justice charged a San Francisco towing company operator this week with insurance fraud on the same day that federal agents executed search warrants at one of his tow yards.
Jose Vicente Badillo, 28, the towing company operator, is facing mail fraud, wire fraud, and money laundering charges related to a scheme to defraud an auto insurance company. Also charged in the case is 30-year-old Jessica Elizabeth Najarro.
The U.S. Department of Justice charged the operator of San Francisco towing company Specialty Towing this week with insurance fraud.
(SF.gov)
Federal prosecutors alleged in a criminal complaint that Badillo and Najarro conspired to defraud the company by submitting a fraudulent insurance claim on a wrecked car that he had purchased in June 2019. Prosecutors said the car Badillo purchased already had front-end damage and a non-functioning engine.
Still, prosecutors alleged Najarro took ownership of the car, purchased insurance for it, then filed a car accident claim. They said she received an insurance reimbursement check for $34,000 and deposited it in a Wells Fargo Bank account allegedly controlled by Badillo.
Badillo was arrested Thursday, the same day that FBI agents were executing several search warrants in San Francisco, including at one of the towing yards operated by Badillo and his wife, Abigail T. Fuentes.
A spokesperson with the Department of Justice said Badillo was arrested at a residence during the FBI raids. Badillo was later released after posting a $50,000 bond.
Badillo and Fuentes did not respond to requests for comment.
It is the latest criminal case brought against Badillo who, along with Fuentes, is facing multiple felonies stemming from an alleged welfare fraud scheme that was brought against them in October by the San Francisco County district attorney’s office.
Prosecutors in that case alleged that as a Human Services Agency worker, Fuentes approved Badillo’s applications for public welfare programs and failed to disclose her relationship to him.
They alleged that the pair also lied about their income and assets to receive other public benefits including Medi-Cal and CalWorks.
Prosecutors said while both schemes were happening, Badillo and Fuentes jointly operated three towing businesses between 2018 and 2023. Prosecutors said the three companies — Auto Towing, Jose’s Towing and Specialty Towing and Recovery — generated more than $2 million in gross annual income.
The scandals started to come more into light in April after a video, which went viral, showed a Specialty Towing truck driver trying to tow a couple’s car while they were stopped at a red light in downtown San Francisco.
The U.S. Department of Justice charged a San Francisco towing company operator this week with insurance fraud on the same day that federal agents executed search warrants at one of his tow yards.
(SF.gov)
The video shows the truck reversing with its wheel-lift lowered, attempting to hook the front wheels of a silver Honda sedan, which kept reversing to avoid the tow truck.
By then, Badillo and Fuentes had been banned from operating in the city because of the welfare fraud case and allegations that one of their companies was profiting from illegal tows.
In August of last year, San Francisco City Atty. David Chiu initiated debarment proceedings against Auto Towing to ban them from bidding or receiving contracts for five years after investigators learned employees had illegally placed a towing sign in the parking lot of a local bank and towed cars without permission between February and May 2023.
A sign warning that cars will be towed.
(SF.gov)
The debarment process often requires an administrative hearing before contractors accused of misconduct are prohibited from receiving city funds.
Chiu said many of the victims whose cars were towed were residents who primarily spoke Spanish and Cantonese, a group that is already susceptible to predatory towing.
“Auto Towing also made it difficult for vehicle owners to retrieve their vehicles, restricted the hours when vehicles could be retrieved, and pressured vehicle owners to pay in cash,” Chiu said in a written statement at the time.
As part of the process, Chiu listed seven witnesses including car owners and the bank’s branch manager in court documents. Also included in the complaint were photos that showed tow trucks hooking up cars from the bank’s parking lot, as well as a receipt for more than $500 that Chiu said each car owner had to pay to retrieve their vehicles.
Chiu took additional action in February by suspending Badillo and Fuentes as well as the three companies they jointly operate, immediately prohibiting them from receiving public funds and receiving contracts until the welfare fraud case is resolved.
“Fuentes and Badillo have demonstrated a clear pattern of predatory behavior designed to enrich themselves at the expense of the most vulnerable among us,” Chiu said in a written statement. “Our City has no interest in contracting with exploitative businesses engaged in illegal conduct.”