MORE than 30 people have been arrested as part of a major investigation into a car insurance fraud ring in a West Yorkshire town that is fuelling a rise in premiums for motorists.
Those arrested in Huddersfield are suspected of scamming insurance companies out of thousands of pounds by staging fake car crashes and pocketing the insurance payouts.
The fraudsters effectively add an average of £50 to each policyholder’s annual insurance premium.
Within the Yorkshire area, both Sheffield and Leeds appear among the UK’s top 20 hotspots for “crash-for-cash” scams, according to the Insurance Fraud Bureau (IFB). Birmingham is the worst area in the country for the fraud.
David Ward, Liberal Democrat MP for Bradford East, who has campaigned against high insurance premiums, said the arrests were another victory in the fight against insurance fraud.
Earlier this week, Mr Ward welcomed the announcement that the cost of motor insurance is to be officially investigated by the Office of Fair Trading after it found premiums rose by nine per cent between January and September 2011. A rise of 12 per cent had already been recorded during 2009 and 2010.
In light of the increase, Mr Ward set up an online survey earlier this year which revealed the premiums of the 1,000 constituents who responded had gone up by an average of 63 per cent since 2009 from £552 to £897. Increasing premiums are thought to be pricing many drivers out of the market.
He said: “It’s absolutely wonderful news. We are trying to do a lot of things to deal with this scandal over insurance premiums. We are obviously trying to catch the people responsible.
“But at the end of the day it’s about the challenging of these crash-for-cash claims because the common view is that it’s just easy money and they can get away with it because the claims won’t be challenged. It’s another brick in the wall for us.”
A total of 35 people, aged between 20 and 65, were arrested as part of the second phase of Operation Thatcham – a major fraud investigation into the crash-for-cash scam operating in Huddersfield – and are believed to have been operating from a business on Blackmoorfoot Road.
About 25 people were also arrested in the first part of the operation in October.
Fraudsters involved in the scams typically drive to busy road junctions and then perform dangerous emergency stops to force collisions with innocent drivers. Claims, which often include fictitious injuries to the scammers, are then made to the innocent motorist’s insurer.
The IFB welcomed confirmation of the arrests.
A spokesman said: “Today once again demonstrates the effectiveness of the insurance industry and police working collaboratively to disrupt fraudsters and protect innocent motorists and genuine policyholders.
“The message is loud and clear – seek to defraud an insurer and you risk serious repercussions, to include prosecution and seizure of assets.”
Detective Constable Mark Lunn, of the Kirklees proceeds of crime team, said more arrests would be made over the coming weeks and months.
“There are people profiting from crime, living a life of luxury and giving people the impression that crime pays,” he said.
“These people will not be allowed to get away with what they are doing.”
Anyone with information on insurance fraud or who has been pressured into taking part in a scam can contact Dc Lunn on 01924 295311 or Crimestoppers on 0800 555 111.