Thursday, October 11th 2012 01:00
The head of an accident management company from Bolton who processed fraudulent insurance claims has been jailed.
The sentencing of Asif
Mallu, along with an order to repay £7250, concludes one of the country's
biggest and most successful investigations into a "crash for cash" scam.
Mallu (born 20/7/74) of Jedburgh
Avenue, Heaton, Bolton, pleaded guilty to conspiracy to commit fraud at
Manchester Minshull Street Crown Court. He was jailed today, Thursday 11 October
2012, for 21 months.
Under the Proceeds of Crime Act, it was heard that he benefited
from his criminality by £12,107.50.
He has been ordered to pay a Confiscation order of £7250.
Mallu ran 24/7 Direct
Claims Ltd, a Bolton company which managed insurance claims. He organised 10
fraudulent claims between May and December 2005 following collisions
deliberately caused by a man called Mohammed Patel, acting within an organised
crime network.
The scam
ensured that all of those involved would earn money at the expense of the other
parties' insurers.
In
October 2008, Patel admitted being the driver in more than 90 forced collisions
between 2005 and 2008, all of which led to exaggerated and fraudulent insurance
claims.
The claimants
would earn compensation for personal injuries and Patel would earn a fee for
driving the cars. The biggest profit, however, went to claims management
companies such as 24/7, who processed the claims.
The company made money from solicitors⿿
referral fees, courtesy car hire and the storage and recovery of cars involved
in the collisions, which on many occasions was never even needed.
The police investigation,
Operation Contact, supported by the Insurance Fraud Bureau, exposed the scam
which potentially could have led to insurers having to pay out millions of
pounds in false claims.
In 2005, workers at an office block at the Eden Point roundabout
on the A34 in Cheadle became suspicious at the alarming regularity with which
collisions were taking place at the same spot on the roundabout.
They noticed the collisions were
always at low speed, and often, the same man was driving.
AXA insurance, one of the companies affected
by the scam, investigated a number of the claims. In January 2008, the findings
were presented to Greater Manchester Police.
The investigation revealed Patel deliberately caused
collisions for whichever client was willing to give up his car keys and
insurance details.
He
would be paid a fee while the claimants demanded compensation for personal
injury, courtesy cars and legal fees at the expense of the other party's
insurers.
Operation
Contact found that Asif Mallu processed five of the Eden Point roundabout claims
and a further five at nearby roundabouts.
The company used an engineer to examine the cars involved in the
collisions. To back up the claims, reports from the engineer exaggerated and in
some cases made up the damage that was caused.
An examination of 24/7's finances showed the company
attempted to make thousands of pounds from these claims.
Chief Inspector Mark Dexter said: "Mallu's
company was registered under the terms of the Ministry of Justice, with a
visible business premises in Bolton, and yet this was all a front for
fraud.
"A long and
complex investigation has proven that he profited significantly from the
scam.
"This result,
however, sends a clear message to others that if they intend to defraud
insurance companies the consequences are severe.
"We also want to make it clear that while insurance
companies are victims, the innocent drivers involved in these collisions were
made to feel as though they were in the wrong.
"The scam left these victims feeling cheated and
violated, often with their premiums increased, so the idea that this is a
victimless crime is nonsense.
"This sentencing concludes Operation Contact, which I can safely
say has played a profound role in the fight against insurance fraud, but the
officers who have been involved are now continuing to tackle organised road
crime.
"In a long and
complicated investigation, where partners such as the Crown Prosecution
Service's Complex Case Unit have been involved from day one, Operation Contact
has rooted out the organised criminal network the likes of Mohammed Patel and
Asif mallu were a part of.
"I can only pay tribute to the dedication and determination of
the small team of traffic officers who formed Operation Contact. These officers
worked tirelessly, sifting through hundreds of thousands of documents, regularly
contacting dozens of victims and in short, putting all of their skills and
training in detecting to the test.
"I am pleased that their efforts and accomplishments have not
only been recognised by the judge, who today gave them a judicial commendation,
but also within Greater Manchester Police, policing nationally and among the
insurance industry."
Phil
Bird, Director of the Insurance Fraud Bureau (IFB), said: "Today's verdict
concludes this landmark joint-operation between Greater Manchester Police and
the IFB, sending a clear deterrent message to fraudsters targeting the insurance
industry - you will be caught, and you will face the consequences of a criminal
record, heavy fines and imprisonment.
"The IFB uses highly-sophisticated counter-fraud software to
interrogate over 130 million insurance records on a daily basis. As a result,
IFB fraud analysts proactively uncover suspicious networks of people, policies
and claims and work alongside police forces up and down the country to bring
criminals to justice.
"Honest policyholders, who ultimately pick up the bill for fraud
through increased premiums, can report insurance fraudsters through the IFB⿿s
free and confidential Cheatline on 0800 422 0421, or report online at www.insurancefraudbureau.org."
Mark
Beales, director of law enforcement liaison at Bolton-based Keogh's solicitors
who represented numerous insurers, said: "So called 'professional enablers' are
the conduit for fraudsters to pursue fraudulent insurance claims. They are the
portal for fraud through which claims are legitimised allowing fraudsters to
succeed. Dealing firmly with these facilitators is key and the conclusion of
Operation Contact sees the end of a very successful investigation demonstrating
how working collaboratively with the police can achieve positive
results."
50 people have
been convicted following Operation Contact, including Mohammed Patel (born
18/08/1985) of Nottingham Drive, Bolton who was sentenced to four and a half
years in prison, having pleaded guilty to conspiracy to commit fraud.
Rezwan Javed (born 24/11/76) and
Rehan Javed (born 19/01/75), both of Dovedale Close, Burnley, Lancashire, were
found guilty after a trial at Manchester Minshull Street Crown Court of
conspiracy to defraud and possession of an article for use in fraud.
Rezwan Javed was sentenced to
six years in prison and Rehan was sentenced to five years in prison.
Under the Proceeds of Crime Act,
it was heard that they each benefited from the scam by £995,915.27 and were
ordered to pay £156,000.
The brothers ran North West Claims Centre Ltd, a Burnley company
which managed insurance claims. They organised fraudulent claims following
collisions deliberately caused by other members of an organised crime group,
including Mohammed Patel.
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