Zurich win ‘phantom passenger’ fraud court case


Zurich worked with Horwich Farrelly to defend a fraudulent claim against Cardiff Council in a road traffic accident case involving a ‘phantom passenger’. 

Michael Falkingham, age 31 from Cardiff, said he was a passenger in a car involved in a collision with a Cardiff Council Ford Transit van, when in reality he was not even present at the scene of the incident. Despite withdrawing his fraudulent injury claim before the case came to court, he was sentenced to four months in prison, suspended for 18 months.  This decision sets a clear standard regarding contempt and sends a warning to potentially fraudulent claimants; courts will prosecute even if they chose not to go through with the claim.

Two other individuals also made claims at the same time as Mr Falkingham and both were dropped. Again, these were both ‘phantom passenger’ claims.

Following the successful conviction of Mr Falkingham, Horwich Farrelly plans to work alongside Zurich to take both of these claimants to court, despite them dropping their initial allegations.

The contempt of court conviction relates to a claim by Michael Falkingham for a false whiplash injury in a road traffic accident in 2014. Falkingham claimed that he was in the passenger seat of a Volkswagen transporter van when a Cardiff Council Ford transit van drove into the back of the vehicle. The reality was that he wasn’t in either vehicle! The only people in the transporter van, when the collision took place, were the driver, her son and her granddaughter.

Falkingham’s level of deceit was extensive. As part of the bogus claim, he went to the University Hospital of Wales to register his apparent injuries after the accident, even though he wasn’t in either of the vehicles.

Although Falkingham withdrew his initial claim in the initial stages, his actions were still seen as fraudulent which demanded court action.

Acting on behalf of Zurich Insurance, for Cardiff Council, Horwich Farrelly argued in court that there were grounds for contempt of court. Horwich Farrelly recorded a series of phone calls with Falkingham in which he admitted that it was both a ‘dodgy claim’ and a ‘cash for crash’ claim. Zurich served proceedings based on this evidence and following the two-day trial, the court found Falkingham guilty of contempt. Based on his early admission of guilt, the court handed down a four-month prison sentence, which was suspended for 18 months.

Ronan McCann, Managing Partner of Horwich Farrelly, comments: “It was right and proper that the court took a hard line against Mr Falkingham, despite him withdrawing his fraudulent claim and only ever submitting a Claims Notification Form. This sends a strong message that insurers will not tolerate individuals seeking to defraud them and publicly funded bodies, even in circumstances where a fraudulent claim is submitted but not actively pursued.

“We will be going after the other ‘phantom passengers’ with the same action as Mr Falkingham in the hope to gain further contempt proceedings. This case should be seen as a strong lesson to all ‘have-a-go’ fraudsters that all fraud, no matter how small or ‘insignificant’, will be punished.”

Scott Clayton, Head of Claims Fraud at Zurich added, “The vast majority of claims we receive are legitimate, and we pay them promptly. However, we have a duty to detect bogus or exaggerated claims which drive up premiums for honest customers.  This case sends a clear message that dishonest claimants – even those who bring a fraudulent claim and then don’t follow through by issuing proceedings – still face the toughest of penalties.”



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