Claims firm exposed staging crashes for insurance scam
Published: 1st Apr 2010 17:23:04
An insurance scam in which car accidents are deliberately staged by a claims company to cash in on compensation has been exposed by a BBC investigation in the Midlands.
Every year, this kind of fraud costs the insurance industry £400m.
Victims of real accidents do, of course, use legitimate claims handling firms to help them get compensation.
But we heard of a company in Wolverhampton which was doing more than just handling insurance claims - they have been staging the crashes as well.
Our undercover investigator met the man who runs Speed Claims, Zeeshan Ahmad.
'Make the accident'
The first time they met, Mr Ahmad openly explained how the system works. The conversation which we filmed secretly, saw Mr Ahmad tell our investigator to "bring the car here" and "then we just do the job on it".
When asked "you make the accident?", he replied "yeah".
And it becomes clear that when they are staged this way, there is cash in crashes.
Secret filming showed how the scheme worked
During the secret filming, Mr Ahmad revealed that there were large amounts of money to be made by falsely claiming for extras.
He said: "You're going to get the value of your car and you're going to put some passengers in your car and the passengers will get some money as well."
He told the undercover investigator the passengers would get injury compensation with the "going rate" being £2,000.
We wanted to test how it worked in practice.
Take the blame
We returned to Speed Claims, this time with a vehicle.
The directors of the company have told us they had no idea what Mr Ahmad was doing. But for him, it seems, business was booming.
He showed us cheques that had come in from other claims. In the secret filming we did, he admitted that he had staged crashes before, boasting that "loads of cheques were coming in".
Mr Ahmad coached us in detail about what we would need to say to our insurers.
He told us about the fake accident five hours before it was meant to have taken place - and warned us not to report it too early.
He reminded us that we should tell our insurers that the fake accident happened at 2000 hrs at night.
He said: "So don't phone them before then! Phone them around nine o'clock, when you see your car."
Astonishingly, he even drew us a map of how the accident was supposed to have taken place to show our insurers.
We left our car with him.
He told us that two cars, one of them ours, would be smashed up in his yard.
He paid us £500 to take part in the scam and admit liability. We would take the blame and the other driver could cash in.
A full 24 hours later and our car was delivered back to us, dropped off around the corner from the so-called accident site.
As instructed, we reported the so-called accident to our insurers.
Fake claim cost
But what Mr Ahmad didn't know was that this was a dummy policy, organised by fraud experts from the insurance company, RSA.
They monitored the policy over the subsequent weeks and, nearly two weeks later, a claim came in from the supposed driver of the other vehicle. He was claiming for whiplash injuries for driver and passenger, plus hire care costs.
We spoke to John Beadle, the chairman of the Insurance Fraud Bureau, an industry-wide group of experts set up to combat this kind of crime.
He said our claim was fairly typical of the kind of things insurance companies face.
"Wrapped up in the claim will be bodily injury, normally whiplash, plus storage of the vehicle, removal of the vehicle from the scene ," he said.
"When you take all these together and the cost of this kind of a claim could well be around £20,000. The fact is that it costs us all around about £44 on every insurance policy as a result of that kind of fraud."
The Insurance Fraud Bureau is so worried about it that it has set up Cheatline, a website and freephone telephone number for consumers to report suspected fraud.
We asked to interview Mr Ahmad but he said he was not available.
On the phone he did tell us that he had not staged a crash. He blamed others for organising it, but our filming shows his involvement clearly.
The authorities are keen to talk to him.
Unsurprisingly, this is one claim the insurers will not be paying.
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Harvard CitationBBC News, 2010. Claims firm exposed staging crashes for insurance scam [Online] (Updated 1st Apr 2010)
Available at: http://www.ukwirednews.com/news/48942/Claims-firm-exposed-staging-crashes-for-insurance-scam [Accessed 31st Jul 2014]
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