Sophisticated multi-million euro fraud ring 'behind staged accident damages claims

eu stars

Sophisticated multi-million euro fraud ring 'behind staged accident damages claims

It has been claimed in the courts that a highly sophisticated multi-million euro fraud ring is behind a scam involving fraudsters staging fake accidents in order to extract damage claims.

The false claims usually involved alleged offending drivers who had only shortly beforehand taken out insurance on old cars after having given false details and identities.

The fraud has been brought to light by Zurich Insurance and the MIBI, who believe they have uncovered an organised and sophisticated multi-million-euro Eastern European fraud ring.

The claim that a fraud ring was operating in this country was made by David Culleton, of Dublin solicitors, DAC Beachcroft in a sworn statement in the Circuit Civil Court on behalf of Zurich and the Motor Insurance Bureau of Ireland which compensates victims of untraced and uninsured drivers.

Evidence of a major insurance probe into "suspicious multiple claims" was laid before Judge Jacqueline Linnane.

Paul McMorrow, who is the Barrister representing Zurich and the Bureau, told the court his clients were also seeking their legal costs against individuals allegedly failing to turn up for medical examinations and produce medical records to prove a claim, despite court orders. As a result of this tactic, the courts had not proceeded with his case.

The courts heard evidence that scammers were taking out last minute insurance just prior to a litany of accidents they believed to have been staged. Evidence was also submitted, that there are many such highly suspicious and strikingly similar type of accidents each tainted by some element of fraud, collusion or conspiracy. With regard to this, Mr Culleton said:
"As a result of their investigations Zurich and the Bureau believe they have been deliberately targeted as part of an organised and sophisticated Eastern European fraud ring which has generated an exposure to a potential 25 personal injuries claims,"

The insurers contend, that these false insurance claims will potentially cost insurance companies €2million in compensation and legal costs and expenses involving forensic engineers and in many cases private detectives.  If these cases end up in the High Court rather than just the circuit courts, these cases could amount to many multiples of millions.

When you consider the consequences of these fake claims, we all know only too well who will end up forking out for all these claims; the regular motorist with their increased premiums.

Mr Culleton told the court, that in one case, an individual who was connected with the motor trade, a 34-year-old Director and garage business owner of a well-established crashed car repair and motor dealership, had continued to lead a flamboyant, active and sporting lifestyle including exposure on social media

It has also been reported that this same individual was connected with at least four of the six accidents which Zurich and the Bureau had committed to the closest scrutiny.

The court heard that the alleged fake accidents were staged in the countryside in remote areas in the dark at the dead of night away from any possibility of discovery. The court heard of four claims relating to a crash in Portlaoise, Co Laois; nine from two crashes at Balrothery, Co Dublin; five from one in Clara, Co Offaly, and seven other claims from two accidents at Swords, Co Dublin.  The accidents occurred between December 2012 and December 2013.

The alleged refused to attend medical examinations or pay for medical costs of examinations and provide his full medical records to the defendants. Mr McMorrow said:
"In contempt of those orders he has failed to comply with a single one of them and we are seeking our costs in the matter and applying for the court to refer the papers to the DPP,"

In the case involving this particular motor business owner, he had shortly beforehand taken out insurance premiums with Zurich on old cars after having given false details and identities.  After dutifully reporting the accidents to Zurich they and their cars would conveniently become untraceable.

It appears that the insurance policies were paid for in an untraceable manner such as cash and shortly thereafter, numerous personal injuries cases would follow and it was the insurers’ investigations that had led them to believe they were staged.

The Judge in this case, Judge Linnane said she appreciated there had been considerable time, effort and money applied to the investigation undertaken by the insurers concluding there was a group staging accidents and making multiple personal injury cases. The court dismissed the claim after coming to the conclusion that there

The judge saw no reason why the outcome of these inquiries might not be forwarded to the DPP for consideration of criminal prosecution.

(As always, if you or a family member are considering buying a used car, don’t buy until you run a car check report with where you will find out the true history of the vehicle.)


Justin Kavanagh
Justin Kavanagh is a recognised leader in automotive intelligence and vehicle data supply to the entire motor industry. He has almost 20 years experience in building systems from the ground up. As the Managing Director of Vehicle Management System, he understands the need and importance of trustworthy and reliable vehicle history and advice to both the trade and the public.
Follow me on LinkedIn

eu stars