Insurance Companies Defrauded In Cash For Crash Scam

Saturday, 25. October 2008

Insurance fraud is growing to epidemic proportions. In the latest scam police arrested a company director who has been allegedly raking in millions of pounds in a ‘crash for cash’ scam involving luxury cars. Detectives arrested a 23 year old man following a raid on his flat in Paddington after an 8 month investigation. The police have confirmed that they are still on the look out for a second person in connection with the crime. In a raid on a warehouse in Tottenham police seized 13 cars supposedly used in the scam including 8 Mercedes, a Lexus and a Range Rover. The directors ran an executive leasing company and several accident management companies. They are alleged to have used the accident management companies to submit claims to insurance companies on behalf of drivers for non existent accidents. A low value car would be ‘at fault’, allowing the fraudsters to claim for damage caused to the more expensive vehicle. They would also claim for the cost of hiring a bogus car from their own fleet at a high price whilst the damaged car was ‘being fixed’. Detectives believe that the scam netted an average of between £40,000 and £50,000 per claim. The police believe that several million pounds were involved. Police have also arrested 25 people who gave their own details to substantiate the claims, believing there was little chance of being caught. By Graham Hill