Airbag scam hits Oz

LATE-model Toyota Corollas are being targeted by thieves in an airbag scam that is threatening to erupt across the country.

Up to nine thefts have already been reported to police from the inner Sydney suburb of Leichhardt over the past two weeks.

An insurance fraud partner of national law firm Hunt & Hunt, Brenton James, said the scam not only posed a safety threat but could also impact on insurance premiums.

"I don’t know whether Corollas are being singled out because the airbags are easier to remove," he said.

Mr James said a used airbag could be worth between $500 and $3000.

He warned insurance companies and local car-makers that the emerging airbag scam could be as widespread as it is the United States, where some deployed airbags in crashed cars have been replaced with inferior stolen ones.

"Some airbags have even been stuffed with shredded paper," he said.

"You wouldn’t know it until you had a severe accident." A Toyota spokesman, Peter Griffin, said Toyota was aware of the problem but urged any owners affected to repair their vehicles through the Toyota network.

"I can only urge people that they used a reputable dealer," he said.

Following the US example, Mr James said the scam involved crime gangs stealing airbags and on-selling them, as well as unscrupulous crash repairers stealing them from cars brought in for repairs after minor collisions and replacing them with used, inferior or incompatible products.

The RACV’s chief engineer, Michael Case, said he had not heard of any specific Victorian thefts, but "that’s not to say it’s not happening".

Mr James said the problem locally "was greater than first anticipated".

"Fraudulent scams typically take three to five years to reach Australia, but this scam is actually already widespread here," he said.

He believes insurers are likely to face a dramatic rise in repair costs as vehicle owners are duped by dishonest repair shops stealing and fraudulently replacing airbags.

Mr James said the scam typically involved a dishonest repair shop removing an airbag from a vehicle that has been brought in for repairs following a collision.

Even though the airbag may not have been affected in the collision, it is removed on the pretence that it was either deployed or damaged in the accident.

It is either not replaced, or an inferior, incompatible or used bag is fitted. The insurer is billed for a "new" replacement bag while the stolen bag is on-sold.