Ghost brokers lead to nightmare for drivers

Fraud Awareness Week - Beware of ghost brokers

18 November 2020

  • AA advises drivers to beware of dodgy brokers as part of Fraud Awareness Week
  • Ghost brokers trick drivers into thinking they have insurance when they don’t or use false documents
  • “If your deal is too good to be true, then alarm bells should be ringing” warns AA insurance MD

AA insurance services are warning drivers to beware of ghost brokers as part of International Fraud Awareness Week.1.

With financial pressures being felt by households across the country, many are trying to find ways of saving money. With insurance premiums one area that people regularly try to make savings on, the AA fears that more drivers could unintentionally fall foul of fraudsters as they try to reduce their spending.

What is ghost broking?

Ghost broking is a scam where fraudsters, called ‘ghost brokers’ trick people into paying for what they believe is an insurance policy. However, the ‘policy’ is either;

  1. A policy bought by the scammers from a legitimate insurance company, but has been obtained using false information and then the documents are doctored to show the customers details
  2. Forged paperwork created by the scammers that looks like it could have been provided by a legitimate insurance company
If your deal is too good to be true, then alarm bells should be ringing
David Coughlan, AA insurance services managing director

Drivers who have made several claims or those who are considered high-risk are more susceptible to being lured by ghost brokers. Equally, ghost brokers often try to entice people through social media, internet forums or on university campuses.

Buying insurance through a ghost broker is the same as driving without insurance so carries a £300 fine and six penalty points.

David Coughlan, AA insurance services managing director, says; “Fraudsters like to pounce when people are at their most vulnerable. Unfortunately, a global pandemic mixed with economic pressures creates the perfect storm for scammers.

“If your deal is too good to be true then alarm bells should be ringing. Rather than just sign on the dotted line without asking questions, it is best to apply the brakes and check the offer is real.

“You can do this by calling the insurer direct or checking the broker is legitimate by consulting the BIBA Broker directory2.

“It’s the sort of scam that can give you nightmares and we don’t want people to fall into the trap.”