Released: April 21, 2008

Debt may be a factor in suspicious fires

Source: Ken Bensinger, Los Angeles Times (Free Registration)

Some folks celebrate their last home mortgage payment by setting fire to their loan agreement. Lately, some people behind on their mortgages are simply setting fire to their homes.

In what appears to be the latest symptom of the nation’s mortgage meltdown and credit crisis, insurers, law enforcement officials and state agencies nationwide report a jump in home and automobile fires in the last year believed to have been set by owners unable to pay their debts. The numbers are small, but they’re leading the insurance industry to scrutinize more closely what seem to be accidental blazes.

“We’ve seen a dramatic increase in this kind of fraud,” said Dan Bales, director of fraud investigations at Mercury Insurance. “People upside-down on their house with variable-interest-rate loans, or upside-down on their cars, are pretty quick to burn their property right now.”

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