Drivers spend £115m on fake policies in four years

Investigations into ghost brokers have uncovered frauds in excess of £11.5 since 2012.

The City of London Police’s Insurance Fraud Enforcement Department (IFED) has carried out 86 investigations since then, with one investigation alone identifying more than 600 people who were victims of the same ghost broker.

In the past year Action Fraud has taken 157 reports from victims, with each losing on average £1,360. But IFED officers believe the true number of ghost broking victims is much higher than that and many victims could be driving with worthless policies.

So, to coincide with the MIB’s (Motor Insurers’ Bureau) Operation Drive Insured awareness week, IFED has teamed up with the Insurance Fraud Bureau (IFB) to share intelligence on insurance policies linked to suspect ghost broking activity.

As part of a week-long trial, City of London Police ANPR (automatic number plate recognition) databases will flag vehicles that are linked to suspected ghost brokers and officers will be stopping vehicles to check drivers are not unwittingly driving without valid insurance.

Detective chief inspector Oliver Little, head of IFED, said, ‘Many people will be looking to find the best possible deal for their car insurance, but if you’re getting somebody to broker a deal for you, then you must make sure they’re a fully authorised insurance broker.

‘Not only are fraudsters leaving their victims out of pocket when they take their money, they’re also leaving their victims potentially liable for tens of thousands of pounds if they are involved in a crash whilst uninsured. We’ve seen many victims who have had their car seized and given fines and points on their licence because they were stopped driving without valid insurance and had absolutely no idea.’

Ben Fletcher, director of the IFB, added, ‘Uninsured driving is a complex issue and in turn requires tackling in a number of ways. Application fraud, including ghost broking, means that people may be driving on our roads without valid insurance, putting both themselves and other road users at risk. This week’s operational activity demonstrates the lengths that the insurance industry will go to protect honest motorists.’

To help drivers avoid falling into the trap, drivers have been encouraged to check the Financial Conduct Authority website, which has a list of all authorised insurance brokers, or contact the insurer directly to validate a policy.

Anyone suspecting they’re a victim of a ghost broker should call Action Fraud on 0300 123 2040, while anyone with information about ghost broking activity can report it to the confidential Cheatline on 0800 422 0421.