Fitzhugh Stephenson said he was encouraged to submit a claim after receiving a call from a claims management company
A fraudster who submitted a false £4,000 personal injury claim has been handed an immediate 12-month prison sentence with no suspension following a successful private prosecution by Allianz and defendant law firm Keoghs.
The judgment, which was the first of its kind for Allianz, also saw the insurer recover all costs via central funds.
Fitzhugh Stephenson originally submitted a claim for vehicle damage and hire, which was paid by Allianz after an insured builder’s forklift truck had reversed into his vehicle. Some 19 months after the incident, Stephenson submitted a further claim for personal injury, triggering an investigation by Keoghs and Allianz that uncovered evidence suggesting the personal injury claim was fraudulent.
A call recording of Stephenson reporting the original incident to his insurance broker included an admission that he wasn’t in his vehicle at the time of impact and a letter from his original claim also backed up the assertion that his vehicle was unattended when the original collision occurred.
Two witnesses attested that Stephenson was actually in the yard shop at the time of the incident, while GP records confirmed he hadn’t sought treatment, despite stating that he had visited his GP on several occasions.
Given this wealth of evidence, Allianz’s defence was amended to fraud, following which Stephenson discontinued his claim. Allianz and Keoghs decided not to accept the discontinuation given the brazen nature of the fraud, and commenced a private prosecution.
Stephenson pleaded guilty, admitting in the pre-sentence report that he had been the subject of a cold call by a claims company and had been encouraged to make an injury claim.
The court considered the fact that the fraud persisted for more than two years and that Stephenson had signed various court documents containing statements of truth that proved to be false, leading to his immediate 12-month custodial sentence with no suspension.
Following the result, Keoghs case lead and Associate Solicitor Nigel Parker said the case should serve as a warning to others considering committing insurance fraud.
“This is a rare and important prosecution, which fires a stark warning to those tempted to submit fraudulent claims for injury, especially when it is as a result of a cold call from a claims company,” he said. “The insurance industry invests a huge amount in investigating fraudulent claims, and this case sends a message that insurers won’t tolerate fraud of any kind, and are willing to take the appropriate steps to fight it.”
Allianz fraud manager James Burge said: “The fact that Allianz took this landmark decision to pursue a private prosecution, which is the first of many to come, just highlights the investment we are continuing to put into fraud detection.
“We are very pleased with the outcome of this case and believe that it demonstrates that committing insurance fraud can have extremely serious consequences. I hope that those considering fraudulent claims and the claims management companies involved in encouraging such behaviours take heed of this ruling.”