Drivers have been urged to steer clear of ghost insurance fraudsters who could cost them their licences.
Ghost broking is the name given to a fraud used by conmen who sell fraudulent car insurance online – often with heavily discounted rates.
The fraud is typically carried out in a number of ways: conmen will either forge insurance documents, falsify the driver's details to bring the price down or take out a genuine policy, before cancelling it soon after and claiming the refund plus the victim's money.
Over the past three years, fraudsters including a man who set up 133 fake policies, a teenage ghost broker who was sentenced to jail and a man who made £59,000 from ghost broking have been dealt with by the courts.
However, it is believed that the true number of ghost broking victims may be much higher than that figure, with some motorists currently driving on the roads unaware that their policy is fraudulent.
It is only when they are stopped by police, or attempt to make a claim, that they will find out they do not have genuine cover.
Now Derbyshire Constabulary is backing the #SteerClearOfFraud campaign run by the City of London Police's Insurance Fraud Enforcement Department to make sure drivers in South Derbyshire do not fall for the scam.
Victims of the scam are said to suffer severe consequences, such as:
- Points on their driving licence
- Vehicle seizure and possible destruction of it
- A fixed penalty notice
- Costs to retrieve impounded vehicle
- Liability for claims costs if involved in an accident
This is on top of the money motorists will have lost buying the invalid car insurance and the money they will have to spend to then buy a legitimate insurance policy.
How to stay safe when buying car insurance
- Trust your instincts – if an offer looks too good to be true, then it probably is.
- Ghost brokers often advertise on student websites or money-saving forums, university notice boards and marketplace websites. They may also try to sell insurance policies in pubs, clubs or bars, newsagents and car repair shops.
- Be wary of ghost brokers using only mobile phone or email as a way of contact. Ghost brokers have even been reported using messaging apps, including WhatsApp, Snapchat and Facebook. Fraudsters do not want to be traced after they have taken your money.
- You can check to see if your car is legitimately insured on the Motor Insurance Database website ownvehicle.askmid.com
Detective inspector Debbie King, head of economic crime at Derbyshire Constabulary, said: "With everyone looking for a bargain it can be tempting to go with that ultra-low priced insurance quote.
"But as with every deal – often if it looks too good to be true then it probably is.
"Fraudsters are becoming ever more inventive in their efforts to scam people and I would urge everyone to take care when ordering any goods or services online."
If you have or think you have been a victim of ghost broking, get in touch with IFED via phone on 0207 164 8200 or email at IFEDIntel@cityoflondon.pnn.police.uk . Alternatively, report it to Action Fraud by calling 0300 123 2040.
