Biggest award of exemplary damages i a motor fraud case in the UK 

Law firm Clyde & Co and motor insurer Admiral have won what is claimed to be the single highest award of exemplary damages made in a motor fraud case in the UK.

Acting on behalf of motor insurer Admiral, Clyde & Co’s team obtained £70,000 damages against a Barnet-based accident management company MS Globenet trading as ACE and its director Mohammed Samavat.

The previously reported highest award for exemplary damages of this type was £50,000 which was obtained in 2016, also by Clyde & Co.

MS Globenet was involved in 20 cases related to a major fraud ring, operating primarily in North London during 2012–2014, comprising 367 third parties and 136 policies. After the vast majority of these fraudulent claims – worth up to £2.5m – were defeated, the decision was taken by Admiral and Clyde & Co to bring a claim for tort of deceit against the accident management company.

During the trial at Central London County Court during 25–26 April this year, the judge, Mr Recorder Oliver Sells QC, found that that the alleged accidents were fraudulent and that MS Globenet director Mohammed Samavat had been knowingly complicit in the fraud.

Recorder Sells set the award at £70,000 – £3,500 for each of the 20 alleged collisions in which it could be shown that MS Globenet had sought to profit. In addition, Admiral was awarded indemnity costs with £20,000 to be paid on account.

In setting the level of damages, the judge noted that MS Globenet had sought to gain from numerous fraudulent claims and that needed to be reflected in the damages. The judge also acknowledged that one of the purposes of exemplary damages was to allow the court to express its displeasure and discourage similar conduct in the future, something that was important in motor fraud as it remains an issue impacting on the wider public through higher premiums.

Clyde & Co instructed Simon Clegg of Park Square Barristers to represent Admiral in court.

Commenting on the case Susan Evans, head of counter fraud at Admiral, said: “These claims were part of a concerted effort by a number of individuals to defraud motor insurers across the industry. From an early stage we worked closely with Clyde & Co to fight the claims presented to Admiral and had significant success. However, we felt it was important not let those who stood to profit from the fraud to walk away without being held to account. Therefore, we hope that the large award made in this case will serve as a deterrent to those thinking of committing fraud.”

Ben Parkin, legal director at Clyde & Co, said: “The sheer number of cases involved necessitated a bespoke strategy and it is very satisfying to see that come to fruition with this substantial award. We continue to seek to defeat claims when they are presented but also to ensure those bringing or coordinating fraudulent claims are held to account.”