DAC Beachcroft's CVT Fraud Focus: First Edition - DAC Beachcroft

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DAC Beachcroft's CVT Fraud Focus: First Edition

Published 7 August 2014

We are pleased to enclose the very first edition of our quarterly newsletter called "CVT Fraud Focus".

It has been almost 11 years since we first started a Claims Validation team, headed and pioneered by Lorraine Carolan. At that stage, fraud was, apparently, focused on motor and was in its development stage. More than a decade later, we act for 32 clients, a wide range that comprises of General Insurers, Lloyds Market, Retail, Corporates and Self Insured organisations. We operate out of three UK sites including the very exciting development of our Glasgow office, and also we have an office in Southern Ireland. What we do is underpinned by Intelligence and the intelligent analysis of data, and to that extent we have formed a 30 strong Intelligence team headed up by Kate Abrahams. Our mission statement in this respect is to use clean, fraud data intelligently to fight fraud.

The aim of our newsletter is to ensure everyone is live to current fraud themes and the diversification of the problem, in addition to covering up to date legal and Intelligence trends.

Our counter fraud mission statement is to provide a quality service, but also ensure that our clients learn from our battles and we hope you enjoy this first edition and content.


The Jackson Mitchell Effect – Further Guidance from the Court of Appeal

Having seen some harsh decisions following the judgment in Mitchell, we have started to see a more pragmatic shift. The courts have indicated that the parties ought to adopt a more reasonable approach to non-compliance or requests for extensions. Some beneficial guidance is provided as to "fundamental dishonesty" and further guidance has now been received from the Court of Appeal in the cases of Denton v TH White, Decadent Vapours LTD v Bevan and Utilise TDS Ltd v Neil Cranstoun Davies (salient points of the judgment are included below).

In Groarke v Fontaine the High Court overturned a decision to refuse leniency to a defendant in a case that will be hailed as a further indication of judges taking a softer approach to compliance with Jackson civil litigation procedures.

Read more

Fundamental Dishonesty – a step in the right direction

A welcome decision in Gosling v Screwfix and Anor saw HHJ Maloney consider QOCS and the notion of Fundamental Dishonesty. He found that a claimant, who had persuaded the Court that he had suffered an injury, but who was found to have exaggerated the extent of his symptoms substantially was found to have been fundamentally dishonest, resulting in him losing QOCS protection and having to pay the Defendant's costs.

In this case the Court found that the Claimant's conduct had been "dishonest and designed to deceive and give a false impression". The dishonesty was crucial to half the value of the claim.

This is an encouraging decision for insurers seeking guidance on what might be classed as "fundamentally dishonest".

The Bankrupt Claimant

DAC Beachcroft recently dealt with a suspected staged claim involving an element of PI, as well as a credit hire claim etc. Experian searches confirmed that the Claimant was declared bankrupt back in 2012. An updated insolvency search was undertaken whereby it was discovered that the Claimant's discharge from bankruptcy had been suspended indefinitely until he fulfilled the conditions set down by the court.

Whilst the 'personal injury' element of a claim would not vest as part of the bankruptcy estate, 'special damages' would. Consequently a Claimant would have no locus standi to pursue special damages claims without the Official Receiver at least being a co-claimant. The claim involved quite a significant credit hire claim with an organisation known to have links with the claimant's solicitors firm.

Read more

Intelligence Conference – The Casualty Fraud Landscape

CVT's first Casualty Fraud publication was launched at this year's Intelligence Conference, which was held in June. The theme of both the publication and intelligence conference was 'The Casualty Fraud Landscape', particularly topical given the increases that have been observed in El and PL related fraud. Around 40 Industry Casualty Fraud Specialists attended and benefitted from hearing about the latest intelligence trends and case studies. There were presentations from insurers who gave testimony as to their experiences of fighting El and PL fraud. There was also a spotlight on Noise Induced Hearing Loss from DAC Beachcroft's James Tallant.

If you would like any further information about our Casualty Fraud presentations or publication then please contact IntelligencePortal@dacbeachcroft.com or speak to Kate Abrahams, Head of Intelligence.

Save the Date - Our Upcoming Events

9 September: Counsel Training Seminar: Jackson 12 Months On

An update on how courts have been applying Jackson/effect on case management with a particular interest on relief from sanctions, resiling from admissions and applying to set aside judgment.

CVT Legal Forum

The aim of the forum is to discuss specific trends and analysis around areas of fraud and we will be looking at market trends, Intelligence Alerts/Operations, the courts perspective as well as some live case studies and how we are dealing.

16 October: Intelligence Forum

November 2014: Scottish Conference

DAC Beachcroft will be hosting its second Scottish Fraud Conference in November to continue the steps taken in starting to successfully combat fraud. The conference will focus on what successes can be achieved by using tactical measures within the Scottish Legal system and how Intelligence will help to drive good, early detection of what evidently remains a significant problem.

Ringed Fraud Conference

Our ringed fraud conference will be focused on developing intelligence into evidence and legal best practice in countering organised fraud, with case studies highlighting the use of technology, analysis and investigation. This will include the use of telematics, evidential story boards and telecomms analysis techniques combined with cutting edge legal approaches. There will also be guest speakers from law enforcement and counsel, who specialise in organised fraud.

We hope that you will be able to join us. If you would like further details on any of these events please contact hhall@dacbeachcroft.com

Case Successes

  • "To Plead or not to Plead" – tackling Hussain v Amin. Read more
  • A wake up call for Fraudsters – the value of phone record analysis. Read more
  • Contrived Accident/Non-Existent Policyholders: Pownall v Metcarth and Aviva Insurance Ltd. Read more
  • Staged Accident: Mr Zaheer Ahmed v Miss Subia Hussain and Allianz Insurance Plc. Read more

Induced Accidents

The cases below all involve suspected Induced ("semi staged") accidents. The various findings are significant in reinforcing some key factors in defending such claims:

  • It always remains for the Claimant to prove their case. Just because a defendant might not meet the threshold required to establish fraud does not automatically mean a claim succeeds.
  • Negligence in a rear end shunt does not automatically rest with the Defendant. It is however up to the Defendant to establish that there was no reason for the Claimant vehicle to stop.
  • Adverse credibility evidence, particularly when developed and presented in a clear and systematic manner, is of particular value in defending suspected induced accidents.
  • Mohammed Shafiq, Sara Shafiq, Usam Shafiq & Khuram Shafiq - Jonathan Davies & Aviva Insurance Ltd. Read more
  • Mr Prince Ayoade v Maxwell Stewart Maintenance Limited (Allianz Insurance Plc)
    Read more
  • Mr Shakeel Mohammed v Brian William Gore. Read more

Spotlight on...Miles Hepworth

Miles Hepworth, formerly a Partner at Keoghs LLP, joined the DAC Beachcroft Claims Validation Team in April 2014 having moved across a small team of specialist fraud lawyers.

He qualified as an Attorney in the Supreme Court of South Africa before moving to the UK in 2001, and transferring his qualification to that of Solicitor of UK and Wales.

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