It is understood that Lloyds TSB Insurance has appointed Westec UK as its creditor insurance fraud investigator.

A Lloyds TSB spokesman said that the insurer had been running a pilot with Westec, but denied that any contracts had been awarded.

"We have been running a pilot but no decision has been made as yet," said the spokesman.

However, market insiders told Insurance Times that, though Lloyds TSB was originally planning to appoint a panel of creditor insurance fraud investigators, the insurer has performed a U-turn and awarded the contract exclusively to Westec.

"Lloyds TSB ran a pilot with Westec and prepared a tender document," said a source.

"But they've scrapped the idea of a panel and have instead given the contract to Westec."