A man who offered fraudulent motor insurance policies to Sudanese nationals living in the UK has been sentenced.
Hafiz Mohammad, 30, of Manchester, acted as an illegal intermediary, also known as a ghost broker. He sold the policies to unsuspecting members of the Sudanese community in the north of England, many of whom did not speak English as their first language.
Six of the policyholders each paid Mohammad a fee of between £120 and £180 to arrange insurance. A seventh policyholder gave Mohammad £1,016 in the belief that they were paying for a full years’ insurance. They were unaware that Mohammad would then set up the policies using false information to reduce the premiums, leaving them without valid insurance.
Mohammad pleaded guilty at Manchester Crown Court on 14 December 2023 to eight counts of fraud by false representation. He was sentenced to 10 months imprisonment, suspended for 12 months, at the same court on 15 January 2024. He must also complete 150 hours of unpaid work and a 15 day rehabilitation activity requirement, and pay victim compensation.
Detective Constable Deborah O’Loughlin-Whitby, from the City of London Police’s Insurance Fraud Enforcement Department (IFED), said:
“Ghost broking can often be perceived as a victimless crime, but this case shows otherwise. Moving to a new country can be daunting, particularly when it comes to practicalities like setting up car insurance. Mohammad’s victims thought that they had found a legitimate broker. In reality, he was out to make a quick buck at their expense and left them without legitimate insurance.
“This can end up costing victims more in the long run in the form of a fine, points on their license, their car being seized, and having to cover the cost of a new, valid policy.
"We urge people to be wary of cheap deals on social media and via messaging apps. If you’re unsure whether an insurance broker is legitimate, check the British Insurance Brokers’ Association or Financial Conduct Authority website for a list of all authorised brokers.”
The case was referred to the City of London Police’s Insurance Fraud Enforcement Department (IFED) in August 2019 by LV= General Insurance, whose fraud team identified six motor insurance policies that it suspected had been taken out using false information.
This included using an older named driver, changing the details of the insured vehicle and lowering the mileage, all unknown to the victims.
Enquiries with the Insurance Fraud Bureau revealed that a second insurer, esure, had identified multiple policies that had been taken out from Mohammad’s residence. This led to four further policies, which were taken out from the same IP address, being identified at LV=.
IFED officers and the LV= fraud team linked Mohammad to a total of 13 fraudulent policies that were taken out at LV= from December 2018 to February 2020.
Mohammad was arrested on 2 July 2020, and a laptop and two mobile phones were seized during a search warrant at his home address.
Ben Fletcher, Director of Financial Crime at LV= General Insurance, said:
“We’re working hard to proactively detect and disrupt the issue of ghost broking to help protect victims and innocent motorists. This crime is incredibly serious as it leaves motorists unknowingly uninsured and takes advantage of vulnerable people who think they’re doing the right thing.
“We welcome tougher regulations across social media platforms through the Online Safety Bill to protect vulnerable people and prevent the continued rise of ghost broking. Our referrals of these cases to the police have risen significantly over the last few years and we're determined to tackle it. This sentencing should send a warning to fraudsters that we will act and bring them to justice.”
During his police interview, Mohammad answered “no comment” to all questions asked.
A number of people targeted by Mohammad provided victim personal statements at his sentencing hearing. One said:
“This has caused a huge amount of anxiety and stress over the last four years. It has affected my marriage because I had to explain to my partner that Hafiz had taken my money. I have never been in trouble with the police, and this again has had a negative impact on my health through worry and stress. As a result of what he has done to me, I do not drive, which has stopped me conducting activities that I participated in.”