The impact of fraudulent insurance

MCE Insurance

MCE assist MCN to understand the impact of fraudulent insurance - as reported by MCN, Steve Farrell

These pictures show fraudsters scraping jeans on the ground as part of the latest scam to force up the cost of insurance for all motorcyclists. They aim to replicate the damage the clothes would sustain in a bike crash to help win thousands of pounds in compensation for an accident that never happened. The scam, exposed by the Metropolitan Police's stolen vehicle unit, also involves fake injuries and bike damage.

£24 million cost of scams

According to motorcycle insurer MCE, fraudulent personal injury claims cost motorcyclists £24.2million a year, adding £22 to every policy. A record number of so-called 'crash for cash' staged accidents and personal injury claims has helped push the average cost of bike insurance up by 14% in the last 12 months. The Insurance Fraud Bureau estimates that 30,000 accidents a year are staged at a cost of £350million. New IFB figures show Birmingham tops of a league table of crash-for-cash hotspots, with Sheffield, Manchester, Liverpool and southeast London also in the top 10.

Dealership invented crash

The latest scam came to light following an investigation into a south-east London motorcycle dealership. Okezie Ejibe, 33, the owner of Supreme Riders in Rotherhithe, and Tosin Adeloye, a 25-year-old employee, were both found guilty of conspiracy to defraud at the Old Bailey on August 9. A third man, Liviu Craciun, 34, pleaded guilty to the same offence last October. Craciun and a pillion passenger had claimed to have suffered whiplash when Craciun's Suzuki GSX-R1000 was struck from behind by a hire van. Supreme Riders gave an insurance assessor a list of damaged parts and estimate for repairs of £9500, leading the bike to be declared a write-off and Craciun to be awarded £6750 and allowed to keep the 'salvage'. Supreme Riders also invoiced the insurers for nearly £15,000 for recovery and storage costs and leasing Craciun a replacement bike. But days after the supposed crash, Met stolen vehicle squad officers found Craciun riding his bike, which was undamaged and intact.

Photographs taken by the assessor revealed the machine had simply been dismantled for the inspection. Three more dismantled motorcycles, each subject to an insurance claim, were seized from the dealership. Ejibe, Adeloye and Craciun are due to be sentenced on September 16. Det Cons Gavin Smith said: "We looked into 11 claims referred by Supreme Riders and a pattern emerged where pillions were carried and received injuries, mostly sprains and whiplash, and expensive clothing - not just motorcycle clothing - and jewellery was damaged." An MCE spokeswoman said the insurer was aware of the scam. She said it would usually be claimed the accident happened late at night with no witnesses. "Also, the hire-car driver will not report the claim," she said. "The rider will report it, explaining that the 'accident' was the driver's fault. The hire-car insurer will then try to speak to the driver and find he is not contactable."

Fraud Cheatline

Richard Davies, an IFB board director, said: "Generally the amount of fraud that the industry is detecting is at a record high. I'm not surprised to hear of it involving high-end motorbikes." He said people who suspected someone of committing fraud could report them to the IFB's Cheatline on 0800-3282550.

13.09.2011 - MCN, Steve Farrell

Facebook Twitter LinkedIn