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New Insurance Fraud Unit will target fake brokers29 Nov 2011by Peter Tait According to a BBC report, as many as 20,000 drivers could be unwittingly uninsured having bought fraudulent or fake car insurance from scam brokers.  These so-called 'ghost brokers'
defraud unsuspecting motorists of millions, often by targeting
communities where English is not their first langauge and who are not
aware of what to expect from a broker or a car insurance policy in this
country.Typically they scam motorists, especially young drivers, via offers of very cheap deals via small ads or fraudulent websites. The victim is either presented with a totally fake car insurance certificate or a genuine one where the personal details have been mis-represented to reduce the premium. In one example, an 18 year old female student was quoted £2,000 by a fraudster, half the quote from a legitimate car insurance provider. The fraudster, meeting her in his car, took an initial payment of £700 and was due to retrieve the balance in £70 payments from her bank, although in the event, took more from her bank account. It transpired that he had taken out a genuine policy in her name but had given her age as 48, her occupation as a driving instructor, and her status as having a full no claims bonus. Detective Superintendant Bob Wishart of the City of London police commented: "This new criminality is particularly prevalent in motor insurance, with fraudsters looking to capitalise on what is a compulsory and sometimes costly product. "We will soon have a new police unit specifically to tackle insurance fraud. Ghost broking is a growing part of this problem and tackling it head-on will be a priority." He was referring to the new Insurance Fraud Unit, funded by the insurance industry, that will employ 35 people. An initial £9m to fund the first three years has been agreed. The Police will have overall control of the running of the new unit but it will be directed by a panel from the City of London Police, the Association of British Insurers (ABI), the National Fraud Authority and the Insurance Fraud Bureau. It will also need to take over some of the activities of the Met's stolen vehicle unit that is due to close. Clearly, motorists should be cautious about 'too good to be true' car insurance offers, especially where they are being offered in an unorthodox manner. If in doubt, do not hand over any money and check with the FSA whether or not they are a genuine broker. You should also check any paperwork carefully to ensure personal details are correct and with the insurance provider directly if you have any doubts. |
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