The IFB teams up with City of London Police to warn students of bogus car insurance deals on social media

“If it looks too good to be true it probably is” – that’s the message the Insurance Fraud Bureau (IFB) and City of London Police’s Insurance Fraud Enforcement Department (IFED) are sending to students to help stop them from falling victim to ‘Ghost Broking’ scams this National Student Money Week.

Fraudsters known as ‘Ghost Brokers’ frequently promote unrealistically cheap and fraudulent car insurance deals on social media to lure in young drivers looking to save money. The scam not only leaves victims out of pocket, but it can result in them having their vehicle seized by police and facing court for driving without insurance.

‘Ghost Broking’ scams are a growing concern. YouGov survey results (commissioned by the IFB) reveal that one in three 18-24 year olds has seen suspicious car insurance ads on social media.

While new figures from Action Fraud - the national fraud and cyber-crime centre – confirm from hundreds of reports of ‘Ghost Broking’ scams received in 2020, those aged 17-29 lost an average of £559 each. 

Furthermore, with so many young people facing significant financial hardship as a result of the disruption of Covid-19, it could make them more susceptible to the scam.   

Stephen Dalton, Head of Intelligence and Investigations at the IFB, said:

“It’s a really tough time for students right now and the last thing they need is to lose their freedom to drive. That’s why we’re warning young people to watch out for unrealistically cheap, fake car insurance ‘deals’ currently being promoted on social media. Frustratingly this scam is all too common and it’s causing more people to drive without insurance and get their car seized by police. We must be savvy and carry out checks if we see a car insurance deal that looks too good to be true.”

How to avoid ‘Ghost Broking’ scams

The IFB is supporting IFED’s #SteerClearofFraud campaign to help educate students about the consequences of insurance fraud as universities gear up for National Student Money Week.

Students are being warned to avoid deals on social media or messaging apps and to only purchase car insurance through reputable sellers.

• If buying through an Insurance Broker they should check the seller is registered with the British Insurance Brokers’ Association (BIBA).
• If buying directly through an insurer they should appear as a registered member of the Motor Insurers’ Bureau (MIB).
• Checks can also be made to see Insurance Advisors are registered with the Financial Conduct Authority (FCA).
  

   

  Report insurance fraud

  The IFB is a not-for-profit organisation that acts as a central intelligence hub, using industry data and public reports to work with UK police to detect and disrupt organised criminal groups committing insurance fraud.

  Anyone with evidence of an insurance scam can contact the IFB’s CheatLine which is quick, easy and confidential to use. The CheatLine can be contacted online or via a phoneline (powered by Crimestoppers) on 0800 422 0421.