The role of social networking sites in detecting

The role of social networking sites in detecting insurance fraud

The role of social networking sites has become increasingly prevalent in recent years in detecting insurance fraud. Paul Hughes examines whether this has helped to level the playing field between claimants and insurers.

In the case of Locke v Stuart, in February, Andrew Edis QC considered for the first time how evidence obtained from social networking sites such as Facebook should be presented in court and he laid down guidelines as to what conclusions the court could safely draw from such information. In this case, the defence established links between several individual claimants via Facebook and through this information, it proved that multiple road traffic accidents involving these claimants had been manufactured as part of a large insurance fraud conspiracy.

The Judge said that it should be possible to prepare a document which accurately and fairly summarises the relevant contents of the Facebook entries and identifies which primary facts are in dispute so that the necessary material can be adduced to deal with that.

Electronic evidence

The advent of social networking sites such as Twitter has marked a watershed for insurance companies in how they can deal with fraudulent and exaggerated claims. It has always been notoriously difficult to challenge the evidence of a medical expert who gives a prognosis in relation to particular injuries. However, given the increasing use of social networking sites and the lack of discretion of many of the site users, it can be possible to obtain useful evidence which challenges the extent of the claimant’s claim. Insurers regularly find themselves faced with a claimant that is unable to work as a result of an accident and unable to enjoy their usual hobbies. Evidence from some sites can assist if it shows statuses or photographs to demonstrate that the claimant is not as adversely affected as they had claimed to be.

In cases where fraud, exaggeration or malingering is suspected, the claimant’s credibility is key. Through the information posted on social networking sites, particularly amongst younger people where the use of such sites is prevalent and where profiles are updated almost daily, insurers are able to compare the difference between a claimant’s pre-accident and post-accident lifestyle. Where an insurer is able to obtain evidence that conflicts with a claimant’s statement, then, in addition to challenging expert medical evidence, it also goes to challenging the claimant’s credibility.

We are increasingly turning to social networking sites to investigate the claimant’s background and the extent of an accident on their lifestyle. Recently 17 bus passengers claimed for injury and after carrying out a search of all the claimants on Facebook we were able to establish that there were links between each of them. Whereas one claimant intimated on their Facebook profile that they had in fact been injured during the crash, another claimant’s posted comments on their Facebook page about how they would conspire together in order to bring claims for personal injury.

Although the evidence obtained from social networking sites can be compelling, insurers should bear in mind that it is rarely the smoking gun that dismisses a claim completely. It can, however, help to drastically limit the injury claimed for and the resulting compensation. It can also help to give insurers some costs protection. For instance, if a claimant has medical evidence saying that they will not return to their pre-accident condition for 12 months but Facebook shows that they had recovered much earlier than that then, whilst it will not necessarily defeat the claim entirely, it will allow the insurer to assess the true value of the claim and make an offer on that basis which should provide them with costs protection if the claimant rejects that offer and continues to perpetuate the fraud.

That being the case, insurers should carefully consider when they ought to disclose any evidence which they feel supports their case. The parties are under an obligation to disclose evidence as soon as possible but a party ought not to be criticised for withholding crucial evidence in support of their case where the claimant has yet to ‘nail his colours to the mast’.

It is sometimes information posted by the claimant’s friends that can be incriminating. This was the case in a credit hire claim that we recently dealt with involving a man who claimed over £220,000 for the hire of a Lamborghini through a credit hire arrangement. In this instance, the information found on Facebook revealed that the claimant’s brother had been convicted for several motor offences which alerted us to the possibility of a fraudulent conspiracy. Through further investigations that we carried out following the initial alert from Facebook, we were able to defeat the credit hire claim in its entirety and our insurer client recovered its costs in full.

Deliberate misinformation

Information on such sites has knowingly been put into the public domain by the claimant and insurers need not fear using evidence from Facebook and other social networking sites in support of defences. As the use of these sites becomes increasingly prevalent and fraudsters grow more sophisticated it appears that some serial claimants are getting wise to the threat of detection. Therefore, insurers should be mindful of claimants deliberately uploading incorrect information in order to put insurers off the scent.

Ultimately, social networking sites are proving to be a valuable tool for insurers, the police and the DWP in discovering all kinds of fraud. The recent ruling in the case of Locke v Stuart shows that the judiciary system is becoming increasingly aware of the significance of evidence that can be obtained through social networking mediums. With clear guidance now issued, insurers can collate and rely on this evidence with confidence and should ensure that such avenues of investigation are routinely followed in tackling fraudulent or exaggerated claimants.

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