UK courts toughen fraud stance

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Insurance

In a sign that UK courts are taking a tougher stance on insurance fraud, three men have received custodial sentences after attempting to make fraudulent personal injury claims against Admiral Insurance. The men have been jailed for contempt of court, even though they had not lied under oath. According to law firm Clyde & Co, which has been taking a lead role in the fight against insurance fraud in UK, this is a sign that jail time is significantly more likely for fraudsters – a stance the law firm supports.

“This is a significant judgment which will make potential fraudsters sit up and take notice,” said Damian Rourke, Partner at Clyde & Co. “The promise of a so-called ‘easy pay-out’ needs to be carefully balanced against the very real risk of a custodial sentence, which the Court has acknowledged arises as soon as someone agrees to be involved in a fraudulent claim. The Court has also sent a very strong message to claimants and their representatives. They need to properly assess allegations of fraud or impropriety rather than simply ‘reacting’ with denials and threats as such reactions may ultimately be very costly.”

Clyde & Co successfully pushed for committal for the three fraudsters on behalf of Admiral after a lengthy legal battle. Two will receive six months’ imprisonment, while one was sentenced to four months.

“We are satisfied that [these men] have been found guilty and given custodial sentences for their fraud,” said Ben Neyland, Head of Fraud at Admiral. “This result sends a clear warning to other criminals who think they can make easy money from making a false claim from a staged accident. Our hope is that people who are approached by the organised gangs who run these schemes will take note that even though all three defendants had abandoned their original claims before getting to trial, the Court still felt it appropriate to hand down custodial sentences. This judgment sends out the important message that as soon as someone agrees to be part of a staged accident for financial gain, they run the real risk of imprisonment. Insurance fraud is not a victimless crime, it affects all [policyholders] through higher premiums. We will use all resources available to us to root out fraudsters and scammers.”