A BBC investigation into the recent increase in fraudulent brokers throughout the motor trade industry has seen the emergence of conmen, who are known as “ghost brokers” throughout the motoring industry.
The BBC reports that ghost brokers are targeting people on a low budget, as well as those who do not speak English as a first language; this is due to the fact that by majority, these two categories of people are less inclined to believe that they are being scammed.
Ghost brokers are growing ever smarter however, they are starting to copy genuine insurers on the customers behalf, but will then change policy details to make the price appear the cheapest on the market (of course this is totally fictitious and will end up in an illegitimate insurance policy being applied to vehicle/s that have been signed up to the policy).
Unfortunately, more motorists are agreeing to these alterations, with others being completely unaware that they are being scammed.
Eric Galbraith, chief executive at BIBA, said: “This is an insurance scam which is being carried out by fraudsters. Forget about the gimmicky names, they are criminals and we are pleased that the new police unit for insurance fraud will be tackling the issue”
So what is being done about the increasing number of ghost brokers?
Detective Superintendent Bob Wishart of the City of London police has explained that the force have launched a whole new police unity that are dedicated on solely tacking insurance fraud, and in particular; tracking down and arresting ghost brokers.
Bob Wishart adds: “Ghost broking is an emerging threat within the insurance fraud arena, costing the industry millions of pounds, leaving companies exposed and meaning thousands of people are unknowingly uninsured. This new criminality is particularly prevalent in motor insurance, with fraudsters looking to capitalize on what is a compulsory and sometimes costly product
Indeed, it has been estimated that as many as 20,000 car users throughout the UK could be driving with an unknowingly fraudulent policy.
Steve Gaywood, head of counter-fraud at Axa, told the BBC: “We all know car insurance premiums have risen in the last couple of years, and for some motorists it is difficult to afford or find.
It seems that some unscrupulous individuals are using this as a hook to con people into buying insurance that isn’t valid.”
It is not just the police force that are being proactive in their approach to tackling ghost brokers however, Gumtree.com has announced that there have been measures implemented to try and eradicate the appearance of ghost brokers, a spokesman from the site said: “Some time ago we reorganized site categories and have removed several as part of this re-structure. The insurance-related advert section is one of those that we removed because it was a higher risk category for our users and had limited traffic.”
There are a few things that can be taken into consideration to try and avoid interaction with ghost brokers however; as with any type of crime, there are varying levels of effort that go into disguising fraud; but mostly there are a few stand out things that anyone searching for cheap motor trader insurance should keep their eye out for:
1. What number is displayed?
Most ghost brokers will only display a mobile number and not a land line, if you see this at all then stay well away from said broker.
2. Is the advert badly worded?
Try to avoid badly worded adverts, whether it be incorrect grammar or spelling, or slightly nonsensical. As we mentioned before, many of these ghost brokers target people whose first language is not English.
3. Is there only a first name present on the website?
Often ghost brokers will be reluctant to give out details of themselves, there is usually not a professional company name and details of brokers first and last names, but simply a first name displayed.