Violence and criminal allegations within Ontario’s tow truck industry frequently dominate headlines, often involving drive-by shootings, arson, extortion, and even murder. However, a major police investigation east of Toronto is now shedding light on another potentially lucrative activity linked to the sector: large-scale insurance fraud.
Court documents obtained by W5 from Peel Regional Police’s investigation, known as Project Outsource, reveal a sweeping case involving more than 50 criminal charges. These include firearms offences, extortion, and participation in a criminal organization. Among the most notable accusations are 15 charges related to defrauding insurance companies, highlighting the alleged role of staged vehicle collisions as a significant source of illicit profit.
Authorities say staged collisions occur when criminal groups deliberately create or manipulate accidents to file fraudulent insurance claims. In some cases, crashes are intentionally caused using low-value vehicles to secure substantial payouts. In other scenarios, a professional driver may stage a collision before switching places with another individual who later claims medical injuries.
Bryan Gast, vice-president of investigative services at Équité, a national non-profit organization that combats insurance fraud on behalf of insurers, said organized crime groups are increasingly targeting such schemes.
“Organized crime tends to find their way into moneymaking opportunities, and this appears to be another one of those,” Gast said.
He explained that staged collisions often involve a network of participants working together. Tow truck operators, medical clinics, paralegals, auto body shops, and car rental companies may all play a role in processing fraudulent claims. According to Gast, the process often begins when a tow truck arrives at the crash scene, setting the scheme in motion.
“The entire operation can involve multiple businesses working together,” he said. “A single claim can generate hundreds of thousands of dollars.”
In June 2025, Peel Regional Police Chief Nishan Duraiappah announced the results of Project Outsource, displaying seized vehicles, firearms, and bulletproof vests linked to the investigation. Police said the operation recovered $4.2 million tied to a criminal network allegedly connected to the towing industry.
Authorities identified what they described as the “Dhami Criminal Organization” as being involved in the case. Investigators say at least 10 insurance companies were targeted, including Aviva, Saskatchewan Government Insurance, Bel-Air Direct, Wawanesa, Security National, Pembridge Insurance, Intact, Economical, and Definity Financial Corporation.
Duraiappah said the investigation illustrates how organized crime groups are evolving.
“What our investigators have demonstrated is that organized crime is no longer specialized in one particular area,” he said during the announcement. “This shows how criminal groups diversify by finding vulnerabilities and turning them into profit.”
None of the charges have yet been proven in court. A lawyer representing some of the accused declined to comment publicly on the allegations.
Meanwhile, industry data suggests the problem may be escalating. While auto theft in Canada declined by about 18 percent between 2024 and 2025, staged collisions appear to be increasing sharply.
Insurance provider Aviva reports that the number of staged collision claims rose nearly 400 percent in 2025 compared with the previous year.
Mike Cardillo, Aviva’s senior fraud leader, said the trend reflects the growing sophistication of organized fraud networks.
“The money is clearly there to be made,” Cardillo said. “One of the challenges we face is that these groups are becoming increasingly sophisticated.”
Aviva has called on regulators to relax restrictions that limit insurers’ ability to blacklist individuals suspected of fraud. The company argues that current regulations requiring insurers to provide coverage in many cases could unintentionally allow organized criminals to continue operating.
Ontario’s insurance regulator, the Financial Services Regulatory Authority (FSRA), maintains that its “take-all-comers” rule ensures fairness. Under the policy, insurers can only refuse customers under specific approved criteria. FSRA has also stated that denying coverage without a criminal conviction could violate the legal presumption of innocence.
Ontario Finance Minister Peter Bethlenfalvy, whose office oversees insurance regulations, said the government is open to examining additional measures to combat fraud.
“There’s no room for bad actions. We’ll always go after the bad actors,” Bethlenfalvy said during a news conference on Wednesday.
He pointed to government investments in anti-theft initiatives, including the creation of an auto theft task force and funding for police-led enforcement projects. These efforts have contributed to the recent decline in vehicle theft.
“There’s always more to do,” Bethlenfalvy added. “We want people to feel safe in this province, and if there are bad actors, we’ll continue working with insurers and police to address the problem.”
Gast said organizations like Équité are able to track suspected fraudsters as they move between insurance providers.
“We can see when someone leaves one insurer and goes to another, using the same bad actors in multiple collisions,” he said.
Investigators warn that the rapid rise in staged collisions suggests insurance fraud may be becoming an increasingly organized and profitable criminal enterprise in Ontario.
