Arson in America: America's largest known arson conspiracy

MUNCIE, IN. – If anyone had noticed, Kenny Allen was the unluckiest man in town.

The outgoing, likable UPS deliveryman had two fires in his home, another blaze that destroyed his backyard garage and two vehicles fires in front of his house -- five fires over an eight-year period that racked up $173,896 in insurance claims. 

But nobody noticed the unusual pattern until one of Allen's friends walked into the local Nationwide Insurance office to pick up a $1,500 check after his own house burned down.

"He'd been in the office frequently and had always been super friendly and flirtatious. He even asked me out once. But this time he wouldn't look me in the eye," said the Nationwide agent, who asked not to be identified because she has relocated to a new state over fears for her safety as a result of the case.

"That's when I became 100 percent sure that something was going on."

Three-and-a-half years later, that something turned out to be America's largest known arson conspiracy.

The ensuing investigation netted the arrest and conviction of 46 men and women in federal and state courts for at least 73 home and vehicle fires that were deliberately set in the Indiana cities of Indianapolis, Anderson, Noblesville and, of course, Muncie.

Among those convicted was Kenny Allen and his sister Vanessa, who was sentenced to 10 years for her role in setting 39 fires. The conspirators collected about $3.8 million in insurance payouts for intentionally set fires committed over a 14-year span from 1992 through the end of 2006.

The conspiracy sent a shiver through the nation's fire community.

"Not one of these fires was called ‘intentionally set' by a fire investigator. Not one. They were all identified as accidental or electrical fires," said former Bureau of Alcohol, Tobacco and Firearms agent Michael Vergon, who led the investigation.

Arson is frequently missed by local fire investigators, a Scripps Howard News Service investigation has found. Scripps obtained records of 1 million building fires reported to the U.S. Fire Administration from 2006 through 2011 and found clear indications that tens of thousands of arsons may be missed each year.

Scripps found:

-- 54,860 fires at ‘unlucky' buildings that, like Allen's home, experienced multiple fires but none of which were reported as arson.

-- 42,434 fires at buildings that experienced foreclosure, according to the national mortgage monitoring firm RealtyTrac.

-- 3,561 fires that had multiple points of ignition, suggesting someone set several fires at once.

-- 77,596 fires in unoccupied or vacant buildings.

"This is sad. Somebody wasn't doing their job. All of those should have been red flags indicating that someone should have gone in and investigated them further," said David G. Stayer, a certified fire investigator for Rehmann Corporate Investigative Services in Troy, Mich. Stayer also has worked as an arson investigator for 14 years for the Michigan State Police.

"Every fire should be investigated. But it comes down to money and manpower," Stayer said. "We don't have the money to put enough trained people out to investigate our fires."

Serial arsonist Kenny Allen agreed to be interviewed for the first time for this story after serving more than four years in federal prison. He's struggling to make a new life while remaining in the town where he says he personally set 14 fires, although police believe it was closer to 20.

"There isn't a day that goes by that I don't think: ‘Man, I was a monster.' I'm just thankful no one was hurt," Allen said. "The whole thing snowballed. People were trying to get out from under mortgages. Word just got out: ‘Talk to Kenny.' It was all greed."

"It is still happening," he said of arson. "Let's be honest. It is still happening."

Fire experts warn that half of the nation's acts of arson are routinely missed because fire departments lack sufficiently trained investigators to determine the origin and cause of most of the 370,000 home structure fires each year.

Many experienced fire investigators discount the official U.S. Fire Administration estimate that only 5 percent of residential fires result from arson, saying the true number is closer to 50 percent.

In all, the Scripps investigation found there were at least 163,879 suspicious fires over the six-year period studied, more than twice the number of fires officially reported as arson to the U.S. Fire Administration. These fires caused at least 788 deaths -- including 12 firefighter deaths -- and 13,009 injuries. Loss to property and contents totaled at least $5.8 billion, although many fire departments decline to report dollar-loss information.

The Muncie Fire Department has one of the nation's worst records, both in detecting arson and reporting it to federal authorities, according to the Scripps analysis. Of 120 suspicious fires, only 5 were reported to U.S. Fire Administration as intentional fires.

"There was never an investigation," Allen said of the fires he set. "Muncie got into the habit of ruling the same night of the fire. Then they wouldn't come back the next day. You'd know right away" that his arsons weren't discovered, he said.

Muncie today has only one fire investigator, Robert M. Mead, who said his department was shocked by the size of the Allen arson conspiracy. Mead said he's never met Allen or any of the other conspirators and did not know that Allen is out of prison or that the serial arsonist has returned to Muncie.

"I don't know that we, as a group, have a grasp of the magnitude of it," said Mead, who began to investigate fires in 2011. "We work to solve problems like the Kenny Allen problem. Could it happen again? Sure it could. But I don't want it to happen on my watch."

Mead said he believes no more than 5 percent of the building fires in Muncie are deliberately set.  "There has been a drastic reduction in incendiary fires. I just don't see a lot of them these days," he said.

Ed Nordskog, a veteran arson investigator for Los Angeles County, believes that fire departments are failing to detect at least half of all arsons in the United States because of a shortage of trained investigators.

"The majority of fire agencies do not investigate probably half of their arsons. They don't even go to the scene," Nordskog said.

There are no official counts -- or even unofficial estimates -- of how many fire investigators there are in the United States. It also is not known how many of the 23,000 fire departments that report information to the U.S. Fire Administration each year operate arson units.

But a Scripps investigation into federal records found that 56 percent of the fire departments, mostly small and medium size, did not report a single act of arson during the six-year period from 2006 to 2011.

One of the most important ‘red flags' for arson, experts say, is economic hardship, particularly when property owners face foreclosure and then benefit from insurance payouts because of a fire.

Scripps entered into a data-sharing partnership with RealtyTrac, a California-based company that tracks mortgage foreclosures nationwide.

RealtyTrac was able to link 430,000 of the fires reported to the U.S. Fire Administration from 2006 to 2011 to its mortgage records and found that more than 47,000 of them started the foreclosure process. Homes that burned during this period experienced more than a 50 percent increase in foreclosure compared to homes that did not burn.

San Diego Fire Chief Javier Mainar, who worked 13 years as a full-time fire investigator before becoming chief, said fires occurring at foreclosed buildings "absolutely" should be considered suspicious. "When you hear stories of a recent foreclosure you certainly put that in the back of your head that this has the potential to be something," Mainar said.

The Scripps investigation found that only 10 percent of such fires were reported to be arsons, although that statistic probably understates how well some arson units perform since many fire departments fail to report all arson activity fully and accurately to the U.S. Fire Administration.

Officials with the U.S. Fire Administration refused repeated requests to be interviewed for this project.

Scripps found the city doing the best job in both detecting arson and reporting accurate information -- is Dayton, Ohio, which found that 49 percent of fires in foreclosed buildings were intentional.

"I know we do a good job. It's experience. We do this every day," said Vicky Carr, the supervisor of fire investigations in Dayton.

Carr, a former Dayton police officer, also oversees two other investigators. All three have attended arson-detection instruction at the National Emergency Training Center in Emmitsburg, Md. Her team identified that 33 percent of Dayton's fires from 2006-2011 were set on purpose. They made 48 arson-related arrests last year.

"This is my job. I don't do anything else," Carr said. "So when you have the same people doing these investigations over and over and over … you get to identify trends."

Another big difference; Carr knows all the local serial arsonists by name, "I know where they worked. I know where they are. I still follow them. I know where they move."

Being a good fire investigator is like being a good cop, she said.

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