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U.S. Grand Jury Investigates Hertz Over Auto Repair Bills

January 27, 1988|Associated Press

NEW YORK — Hertz Corp. says it is cooperating with a federal grand jury investigation into possible forgery and bill fraud involving charges to customers and insurance companies for auto repairs.

The company has acknowledged that it used phony damage claims, altered documents and inflated repair bills to charge higher prices than it paid to repair autos damaged in accidents.

It said the practices, which lasted seven years and pulled in about $13 million, were halted when top management learned of them in 1985.

An executive in charge of accident damage claims was fired, and all payments made under the improper practices will be refunded, the company said.

Hertz spokesman Joseph Russo said the company is cooperating with the grand jury inquiry being conducted by the U.S. attorney in Brooklyn.

Assistant U.S. Atty. Jonny Frank, who is leading the investigation, declined to comment about the case.

The company said it had already returned about $3 million. It is not known how many people were affected.

"Hertz deeply regrets that these practices existed and is committed to ensuring that they do no recur," said a company statement issued Monday night after the phony billing practice was first reported on WNBC-TV.

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