Joining forces to fight fraud

Joining forces to fight fraud

Since 2012, the City of London Police’s Insurance Fraud Enforcement Department has seized a total £2.6m in criminal assets.

Now in its seventh year, IFED has convicted 433 insurance fraudsters, leading to 239 years in custodial sentences, 108 years in suspended sentences, 13,355 hours in community orders and more than £100,000 in fines.

The unit works in collaboration with multiple law enforcement agencies, together with insurers and the Insurance Fraud Bureau, which provides information and intelligence, and is funded by a compulsory levy on members of the Association of British Insurers and the Corporation of Lloyd’s.

Article continues after advert

Collectively, members of the ABI and the Corporation of Lloyd’s have invested more than £30m since 2012. Indeed, detective chief inspector Craig Mullish, acting head of IFED, says the department receives around £4m from the trade association and Lloyd’s every year.

So how exactly do industry and police work together to fight fraud?

Industry’s priority

As its name suggests, IFED is the specialist police fraud unit investigating insurance fraud.

Examples of this include staged motor accidents and commercial public liability fraud, as well as emerging threats such as illegal insurance advisers or ‘ghost brokers’.

While IFED primarily targets general insurance fraud, which it says is the most common, it also investigates some longer-term frauds.

IFED’s Mr Mullish explains: “Motor insurance makes up about 45 per cent of fraudulent insurance claims and so is a big part of the work we’re seeing.

“There is also ghost broking and individuals who want to benefit on the back of a disaster, such as the Manchester bombings and Grenfell tower disaster; it’s a problem that people will always look to profit from other people’s huge misfortunes,” he continues.

“Effectively ghost broking continues, whereby criminals are selling fake insurance policies to members of the public, and members of the public think they are insured but are not. And that’s a continued threat to the industry and a continued threat to the public.

“This is where IFED works with the industry to ensure we prosecute the individuals.”

Mark Allen, fraud and financial crime manager at the ABI, explains in 2011 the City of London Police was facing resource cuts, and combined with the arrival of locally elected police and crime commissioners, meant it was likely community-related crimes, rather than economic crimes such as insurance fraud, would take priority.

Mr Allen continues: “The insurance industry recognised that if it was to make real inroads into curtailing insurance fraud – which was increasing with detected claims fraud valued at £1.2bn in 2011, an increase of 9 per cent on 2010 – it needed to look at funding a unit dedicated to preventing and enforcing against insurance fraud.”