Fraud and credit hire sometimes seem to go hand in hand, and the reason is not hard to discern, it is the corrupting influence of money: whether that be grasping claimants lying about whiplash symptoms, organised criminal conspiracies of fraud rings seeking to commit insurance fraud, or professional witnesses instructed on behalf of insurance companies forging evidence and lying in court, whilst pocketing their fees.
In recent weeks the Auto Focus litigation seems largely to have concluded with the principal protagonists receiving substantial jail terms per the press and TV reports:
The judgment leading up to this point can be found here: Accident Exchange v Nathan Broom and others  EWHC 1096 (Admin) and over some 79 pages Mr Justice Supperstone sets out the long and sorry story of Auto Focus and Accident Exchange.
In brief the case concerned applications by Accident Exchange to commit a number of professional witnesses formerly employed by Auto Focus to prison. As the judge noted in his judgment:
AE was part of Accident Exchange Group plc. It was a specialist car hire and claims management company whose main business was the hire of cars to victims of road traffic accidents. It operated a fleet of mainstream, specialist and prestige hire vehicles, and provided replacement cars on credit hire terms.
The Defendants, and each of them, were employed as rates surveyors by a company known as Autofocus Limited “(AF)”. The First and Seventh Defendants were both rates surveyors and team leaders. The Second Defendant was a Director of AF.
AF provided forensic services principally to motor insurers when an issue arose in litigation in the County Court as to what daily rate of hire could be recovered by a car hire company through a claimant whose car had been damaged and who had hired a replacement car on credit hire terms (even though the claimant could have afforded to hire one on non-credit hire terms). Insurers, who in the ordinary way bore the proper cost of the hire, very often challenged the charge that was made.
The thrust of the evidence on behalf of Accident Exchange was summarised in this way:
In his first witness statement dated 6 January 2016 Mr Evans describes how in 2008, but more throughout the course of 2009, it became increasingly evident to AE that there was reason to doubt the accuracy of the rates evidence that was being produced by AF. The disparity between the sums the courts were awarding claimants based on AF’s evidence and the hire charges incurred was becoming cumulatively extremely significant. In the latter half of 2009 evidence began to come to light that AF’s reports were not only inaccurate, but contained information which inquiries suggested was simply made up. Mr Evans says, by way of example, car hire companies included in the surveys produced by AF were being quoted as having (1) given a rate that did not exist at the location referred to, (2) denied ever having employed an individual at the branch alleged to have given the quotation, (3) denied having had the make and model of car for which they had allegedly quoted, and (4) denied the terms as to excess levels as stated in the reports produced by AF. This led Mr Evans to commence an investigation into a number of cases in which AF had produced reports and given evidence. As a result of those investigations AE identified 26 cases in which evidence had been obtained which suggested the evidence of AF was false, a further 20 cases in respect of which it wished to undertake further investigation as to the validity of the evidence, and an additional 20 cases where the award for hire charges had been reduced on the basis of AF’s evidence and which were open to potential appeal.
Over a trial lasting a number of weeks, the court considered the evidence of what had been referred to in earlier judgments of “industrial scale perjury”: although a significant number of the Defendants did not contest the allegations made against them.
The judge concluded at paragraph 322 of his judgment:
The evidence that AF was involved in the systematic, endemic fabrication evidence in which the Defendants and each of them knowingly and actively participated throughout the material time is overwhelming.
In addition to going to prison, the defendants will have to bear the costs of the trial and these are likely to significantly exceed £1 million.
So what lessons does this case carry for the future? Apart from the obvious “tell the truth” when giving evidence in court?
It shines a spotlight on some murky practices that have applied in the past, and points to the need for BHR evidence provided in current cases to be rigorously evaluated, not only by claimants seeking to recover damages for credit hire but by the insurance companies and solicitors who commission such evidence.
In particular if telephone calls have been made, are there recordings which should be disclosed? If evidence is obtained from proprietorial databases, how should the accuracy of such data be verified?
When a BHR report is received, should a claimant’s solicitor carry out their own checks, ringing the companies which purportedly had vehicles available?
And what material should be exhibited to a BHR report to demonstrate that the figures contained within it are not only genuine but not misleading, through eg, the absence of terms and conditions.
The Autofocus debacle demonstrates the danger of accepting apparently compelling evidence at face value and although this damaged the financial interests of Accident Exchange, it has also illustrated the need for due diligence by insurance companies and solicitors who act for them.