LAST UPDATE | 21 Nov 2019

GARDAÍ HAVE THIS evening confirmed they are investigating wide-scale fraud related to insurance ghost brokering activities throughout the State.

The probe is being carried out by An Garda Síochána Special Investigations Unit attached to DMR Roads Policing Unit at Dublin Castle.

Hundreds of motorists have been left uninsured due to ‘ghost brokers’ falsifying information and using stolen credit cards to pay for policies on behalf of unsuspecting customers, the Dáil heard earlier today. 

Gardaí said they are liaising with the Insurance Federation of Ireland and numerous insurance companies in relation to this matter. One person has so far been arrested in relation to the activity.

Tánaiste Simon Coveney said many drivers are unaware they have been duped and only realise they have no insurance when they try to take out a claim. 

“My understanding is that it is very much under investigation by An Garda Síochana. The gardaí are liaising with the insurance industry as a whole to try to get a handle on the extent of this issue which seems to involve significant numbers,” he said.

“It is consumers here who are vulnerable, who think they are insured and in fact they are not in some cases, so this is a criminal investigation that the Garda are resourced to pursue,” added Coveney. 

The Tánaiste said the government would stay in close contact with the gardaí, stating that if additional policy and legislation is needed to help the gardaí do their work, that will be considered. 

The issue was also raised with the interim CEO of Insurance Ireland Gerry Hassett who appeared before the Joint Oireachtas Committee on Finance, Public Expenditure and Reform today.

‘Disturbing development’ 

He said it is a “disturbing development” stating that some companies have been more affected than others.

Sinn Féin Finance spokesperson Pearse Doherty has called for the establishment of a stand-alone insurance fraud unit within An Garda Síochana to investigate insurance fraud, including a clamp-down on ‘ghost brokers’. 

Such a unit was recommended in the Cost of Insurance working group report, however, the gardaí as well as the Minister for Justice Charlie Flanagan have not accepted that recommendation, with plans to roll out the specialised unit now shelved. 

“The activities of so-called ‘ghost brokers’, who take out policies with false information for unsuspected consumers, only for the cover to then be cancelled by insurance companies, must be tackled immediately.

“It is reported that these ghost brokers have taken out more than ten thousand insurance policies, with hundreds of these policies being cancelled for consumers who are then left without cover when accidents occur,” said Doherty. 

“These criminals are offering unsuspecting consumers low premiums by providing false information to insurance companies, and taking commission from the sale.

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“When companies then discover that these policies were bought on the basis of false information, sometimes using stolen credit cards, the policies are cancelled, leaving innocent consumers out-of-pocket and without any cover. These so-called ghost brokers engaged in organised crime must be stopped.” he said. 

How to check a broker is legitimate

Brokers Ireland,which represents 1,250 brokers registered with and regulated by the Central Bank of Ireland, has today called on consumers to be more alert to the dangers of fraudsters pretending to be insurance brokers and to remember if an insurance quote seems too good to be true it almost certainly is.

It said consumers to always check the authenticity of any person or company selling or administering insurance policies.

Cathie Shannon, Director of General Insurance at Brokers Ireland, said customers should check the Brokers Ireland website to check if a broker is registered with them.

Customers can also check the Central Bank the website, which provides a search facility to enable consumers check whether the person or company purporting to sell insurance or administer policies is a regulated entity.

With reporting by Garreth MacNamee