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Ghost broker sentenced for fake insurance scam

On Monday 3 April 2017, Daniel Toma Barbu, aged 49 of Tunmarsh Lane, London was given a suspended sentence of 16 weeks in prison, suspended for one year, along with 120 hours unpaid work within 12 months after he put drivers at risk by setting up false insurance policies.

The City of London Police’s Insurance Fraud Enforcement Department (IFED) was contacted by LV Insurance in March 2014 after it initially indentified 18 suspected fraudulent policies. IFED’s investigation uncovered additional fraudulent policies set up by Barbu who is thought to have made £59,200 from the scam.

By setting up car insurance policies using addresses that were not linked to the policy holder, Barbu was able to register the policy holders’ cars to rural addresses with lower insurance premiums. This is known as ghost broking.

The false policies were set up using Barbu’s bank details as well as unregistered email addresses and mobile phone numbers. He then benefitted from the lower premiums himself or sold them to others for financial gain.

Residents at the addresses used by the defendants have confirmed that the policy holders have never resided at the addresses given on the policies and the cars registered to the policies have never been kept at those addresses either.

Barbu was arrested in November 2014 and was charged with 22 counts of fraud as a result of the IFED investigation.

Detective Constable Jamie Kirk said: “Ghost broking is a substantial problem that has seen Barbu take advantage of drivers looking to find cheaper car insurance deals. He has compromised the safety of people on the roads and we believe he profited from these actions. Ghost brokers must be stopped and the public need to remain vigilant in order to avoid falling prey to other fraudsters like Barbu.”

Clare Lunn, LV= Director of GI Fraud, said: “We’re pleased that this fraudster has received a custodial sentence, which we hope will serve as a deterrent to others who believe they can deliberately misrepresent policy details. The actions of ghost brokers can increase premiums for genuine customers and cause distress to those whose details are used. Customers using a broker should always make sure that they are reputable, as victims of ghost brokers will not only lose their money but also risk a criminal record for driving without insurance. LV= will always push for the toughest sentences for those who are prosecuted.”

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