Crash-for-cash Insurance Fraud

Debate between Gregory Campbell and Elliot Colburn

Wednesday 22nd May 2024 Westminster Hall

[Elliot Colburn (Carshalton and Wallington) (Con)]

I beg to move,

That this House has considered the matter of tackling crash for cash insurance fraud.

It is a pleasure to serve under your chairmanship, Ms Fovargue. So-called crash-for-cash insurance fraud is an issue that many of my constituents have brought to my attention in recent weeks and months. “Crash for cash” refers to incidents in which individuals deliberately stage or cause road traffic collisions for financial gain. The scams often involve making fraudulent insurance claims for injuries or damages that did not actually occur. Often perpetrators exaggerate injuries or falsely claim that additional passengers were involved in a collision, to increase their payouts.

There are three principal types of crash-for-cash scams that I want to talk about: induced accidents, which involve fraudsters targeting an innocent motorist as the driver “at fault”, often by suddenly braking in front of their car to cause a crash; staged accidents, which involve fraudsters crashing their own vehicle or mimicking the damage of a crash by using tools such as sledgehammers; and fabricated accidents, which involve fraudsters submitting false claims for accidents that never occurred. The scams are constantly evolving, presenting numerous variations beyond the principal types.

Crash-for-cash fraudsters often target vulnerable drivers who are in a hurry or are unwilling to cause trouble. I have heard about women in my constituency being particularly targeted for such frauds. The scams harm all law-abiding motorists, increasing unnecessary work for the emergency services and the NHS, and causing innocent victims to lose their no-claims bonus and face rising premiums. The proceeds from the scams may go on to fund other serious organised crime. Not only are such actions deceitful, but they are already illegal, falling under offences in the Fraud Act 2006 and the Road Traffic Act 1988.

To fully explain the scams, I will share a few examples. Katrina is a brave woman who experienced crash-for-cash fraud at first hand in an incident near the Wallington high street last month when she was on her way to pick up her daughter from school. As she waited to turn right, a biker on her right stopped to give way. As the traffic halted, she cautiously pulled out halfway, stopping to ensure that the left side was clear. However, when she turned her head to check, another biker had collided with the front of her car. To her dismay, she noticed that the first biker was laughing, and the biker who had hit her immediately began filming the scene. Shaken and confused, she pulled around the corner to exchange details, but encountered a language barrier and evasive behaviour from the biker.

Despite the minimal damage to her car, something felt off. Trusting her instincts, Katrina reported the incident to her insurance company and the police. Following police advice, she contacted the Insurance Fraud Bureau. Later the same evening, she witnessed a similar incident in Sutton, although at the time she did not connect the two. A couple of days later, she discovered through a Wallington Facebook group that others had experienced identical incidents in the same week within the small area of Carshalton and Wallington. That confirmed her suspicion that it was not an accident, but part of a deliberate scam. Recently, she has received a letter from a law firm requesting a settlement. She intends to fight the claim, as it is appalling that people can exploit such fraudulent schemes, potentially affecting insurance premiums and causing undue stress and injury. I am sure that we wish her all the best.

Katrina’s story underscores the importance of vigilance and the need to report suspicious incidents. Not only are so-called crash-for-cash scams deceitful, but they have real consequences for innocent victims. This bold woman’s decision to share her experience highlights the importance of raising awareness of the issue and the need to do something about it.

Another victim in Wallington was targeted by a moped scammer who intentionally crashed their vehicle and refused to give details. The police did not attend; the victim was left to gather evidence alone. Another incident on London Road in Wallington involved a moped scraping a car and fleeing when a police car approached. The victim’s dashcam only captured the front, making it difficult to prove a scam.

A parent in Sutton faced a similar scam during the school run, causing immense stress, especially with young children in the car. There appears to be a trend of parents, particularly mothers, being targeted during the school run, when roads are busier and people are in much more of a rush. For that couple, it all began when a motorbike deliberately collided with the husband’s car, resulting in minor damage. Although the biker admitted fault at the scene, they then filed a fraudulent insurance claim for a substantial amount of money, causing my constituent significant frustration. It took persistent effort, including escalation to the chairman of Admiral, for the case to garner the attention it deserved.

The same couple were then involved in another incident in Wallington, also involving a moped. Despite the moped driver refusing to provide details, the police initially failed to respond. It was not until the couple posted on the social media site Nextdoor and filed a report that the police began to take action. Thankfully, CCTV was available for the incident, which shed light on the situation. However, even the supposed witnesses turned out to be a part of the scam, leading to a barrage of fraudulent insurance calls. It has been a frustrating ordeal, but the couple have diligently reported all incidents to the authorities and their insurance company and are hoping for a resolution.

The Insurance Fraud Bureau, a not-for-profit organisation established in 2006, focuses on preventing and detecting such organised fraud. It supports the insurance industry and law enforcement by providing intelligence and assisting in investigations. It also attempts to raise public awareness about insurance fraud scams and educate consumers on how to identify and avoid them. In 2023, the IFB managed more than 150 live operations, valued at about £90 million, and referred 52 cases to the police. It received more than 5,000 reports through its CheatLine, with 68% resulting in actionable intelligence. Currently, it has about 6,000 active crash-for-cash investigations, worth more than £70 million. That represents about 30% of all its live operations.

The Insurance Fraud Enforcement Department, which does great work to detect organised fraud, puts research into action. It is a specialised police force established in 2012, funded by the Association of British Insurers and dedicated to tackling insurance fraud. Hosted by the City of London police, the UK’s lead force for economic crime, the IFED operates independently while collaborating closely with insurance companies. Since its inception, it has investigated fraud valued at £360 million, made more than 3,230 arrests and secured more than 2,200 convictions, resulting in nearly 320 years of prison time.

[Mr Gregory Campbell (East Londonderry) (DUP)]

I congratulate the hon. Gentleman on securing this debate. Before this morning, I would not have imagined that the figures were so tremendously high. Does he agree that the millions of motorists who insure their cars year on year will suffer as a result of crash-for-cash fraud, not just this year and next year but in ongoing years? We need firm and decisive action to ensure that it does not occur to the level that he is very clearly elucidating.

[Elliot Colburn]

The hon. Gentleman is absolutely right, and I will come on to that point shortly. This is not a victimless crime; it is not that the fraudster gets some money but no one is worse off. Real people’s insurance premiums are going up, often by an amount that they cannot afford, and we absolutely must do something about it.

The IFED has investigated so-called crash-for-cash fraudsters. In September 2021, it secured convictions against three individuals who deliberately caused collisions that resulted in substantial damage and injuries. The fraudsters filed multiple personal injury claims totalling nearly £50,000, but thanks to CCTV footage and inconsistencies in their accounts, the insurer referred the case to the IFED, leading to custodial sentences ranging from nine to 20 months. In February 2022, similar convictions were secured against another three individuals who also staged a collision, with claims amounting to £48,000.

The insurance industry runs several public awareness campaigns on crash-for-cash scams and tries to provide drivers with the knowledge and tools they need to protect themselves. Recent campaigns have focused on crash-for-cash moped scams, which are particularly prevalent in London at the moment, although I am sure the same applies in other cities and other parts of the United Kingdom. It is vital to raise awareness of the issue so that motorists have the knowledge to protect themselves, so I will repeat some of that advice now.

Motorists should be cautious of cars travelling unusually slowly or erratically and of drivers paying excessive attention to the vehicle behind them; should maintain a safe distance so that they can brake in time; should follow the highway code and look ahead for potential hazards, including unusual driving behaviour; and should notice if the other driver is too calm and has pre-written their insurance details or if injuries seem exaggerated. Those who are involved in a suspected crash-for-cash incident should gather as much information as possible, including written details, photos, dashcam footage and any nearby CCTV; should report the incident to their insurer, the local police and the IFB CheatLine; and should stay vigilant and informed to protect themselves and others to help combat the scams.

An investigation led by the IFB, the City of London police, the IFED and several insurers has found that 2,250 people in London alone have been the victim of such a scam in the past two years, and many of the suspected fraudsters are believed to be couriers delivering items such as takeaways. As I said, the IFB is currently investigating more than 6,000 suspected claims, estimated to be worth £70 million.

I welcome the measures that the Government have taken to tackle insurance fraud, such as the insurance fraud taskforce, which was set up in 2015 and comprises members from the insurance industry, the Financial Ombudsman Service, citizens advice, the Treasury and the Ministry of Justice. The taskforce has conducted a review and made several recommendations; I note that its 2017 report highlighted so-called crash-for-cash scams. I welcome the significant steps that have been taken more recently to enhance fraud enforcement as part of the Government’s 2023 fraud strategy, including appointing 400 specialist investigators as part of a national fraud squad and creating the new voluntary post of anti-fraud champion, which is currently held by my excellent hon. Friend the Member for Barrow and Furness (Simon Fell).

Despite those efforts, obtaining detailed statistics on crash-for-cash offences remains challenging. Official crime statistics do not separately identify such offences; instead, they are grouped under insurance-related fraud. In 2023, approximately 13,700 offences were recorded in that category in England and Wales, and the IFB estimates that 69,500 personal injury claims are linked to crash-for-cash scams annually, costing the insurance industry nearly £400 billion.

What is the Minister’s strategy to tackle this growing issue and what work are Ministers doing in conjunction with the industry and police to work on establishing joint strategies for prevention? The fight against crash-for-cash scams needs a collective effort from law enforcement, Government agencies and the insurance industry. I hope that my constituents’ cases that I have highlighted today will encourage us all to work together to protect innocent motorists and ensure that those who perpetrate such fraudulent schemes are brought to justice.

Waste Incineration Facilities

Debate between Gregory Campbell and Elliot Colburn

Tuesday 11th February 2020 Westminster Hall

[Elliot Colburn (Carshalton and Wallington) (Con)]

It is a pleasure to serve under your chairmanship, Sir Roger. I congratulate the hon. Member for Washington and Sunderland West (Mrs Hodgson) on securing the debate so quickly after we last chatted about this issue. It is good to see so many familiar faces from the previous debate.

Members present at that debate will remember that I brought up the Beddington incinerator in my constituency, and I will give an overview of what it is like to live in the shadow of one of these things. I spoke about the harm it does to my constituents in Carshalton and Wallington and about my campaign to improve air quality monitoring near the site, both to prevent operators from regulating their emissions and to take into account the effect on local roads, congestion and air pollution of taking the waste from four London boroughs into that one site.

In this debate and the previous one, Members from all parties spoke of their concerns about what might happen to their constituents if incinerators are granted approval in their patches. I am sad to report that our previous debate was met—as I am sure this one will be—with scorn by my local Lib Dem-run council. Just to recount some of what has been said to me since the last debate, I have been told that we surely understand that there is no alternative to incineration; that Members attending these debates prefer landfill; that we do not recognise the benefits of district energy schemes—not the least of which is to lock residents into energy prices at least three times higher than the market average; and that none of us understand that incinerators are not nearly as bad as we have made out. That is the gist of the stories and labels that have been thrown at me since we last discussed this matter. However, I have not heard a single Member today—or ever—say that landfill is any better. None of us is saying that. Many have pointed out that incineration is considered only slightly better than landfill. In many cases, incinerators are worse—particularly when they burn plastics. That point has been powerfully made today.

Something the council should find sobering is the fact that the emissions figures for January 2020 have just been released, and they demonstrate how out of touch it has been on the issue over the years.

[Mr Gregory Campbell (East Londonderry) (DUP)]

Does the hon. Gentleman agree that factually based information about proposed and existing sites is crucial, to enable local people to take decisions that will affect them and future generations?