Fraud Claims - 2019 In Review

The biggest accomplishment in the battle against claims fraud should be realised in April 2020 with the introduction of the full range of reforms to the whiplash claims process. The introduction of tariffs for whiplash injuries and the expected increase in the small claims track are squarely aimed at discouraging claims which have made the UK the 'whiplash capital of Europe'.

However, this success should not mean that insurers and defendant representatives can rest on their laurels. Fighting fraudulent claims remains high on the agenda, and the fraud team at Clyde & Co have continued to be at the vanguard of these efforts, securing several major victories ranging from pre-action to Trial successes, providing precedent for dealing with fraudulent claims.

In a case believed to be the private prosecution by an insurer for public liability fraud, Clyde & Co acted for Aviva in bringing a 'slip and trip' fraudster to justice. Farida Ashraf's wholly dishonest and fraudulent claim for £60,000 had been dismissed in 2016, when CCTV footage revealed two female accomplices placing a pallet of orange juice cartons on the floor of a supermarket so that Ashraf could pretend to stumble over it. She was sentenced to a suspended jail sentence of 21 months.

Moving from multiple accomplices to multiple identities, our investigations in another claim resulted in a government lawyer being sentenced to 8 months in prison for contempt of court. The claimant, Muhammad Bilal, used a complex web of connections and false identities to successfully ensure that an accomplice received compensation, before pursuing his own claim. This was struck out for dishonesty. Due to his position, it was deemed in the public interest to pursue a contempt of court finding.

Our success last year in applying for the committal of three parties for contempt of court demonstrated that the historic and restrictive use of committal proceedings where claimants have lied in the face of the Court at trial has changed. Our success demonstrated that a claimant who knowingly pursues (and issues) a fraudulent claim is likely to receive a custodial sentence; the balance has been tipped further into the favour of insurers and defendants by the cases of Zurich Insurance v Romaine and Jet2 Holidays Limited v Hughes & Hughes.

In Romaine, the Claimant issued proceedings for a noise induced hearing loss claim, then later discontinued as a means of escaping a strike out application, only to then be served...