Private detectives now on the trail of ambulance chasers as fake insurance claims soar
'Harvesting' of personal injuries cases is being blamed for rise in the number of fake insurance claims, writes Charlie Weston
The regulatory body for solicitors is using private detectives to spy on lawyers who it suspects of bulk-buying personal injuries actions.
The solicitors are under the spotlight over suspicions that they bought thousands of actions from claims-harvesting websites.
More than 20 solicitors are thought to be engaged in buying books of claims that have been hoovered up from adverts placed online.
The Law Society has a strict policy ban on claims harvesting. It has angrily dismissed suggestions that it should do more to ensure that its solicitor members vet clients to weed out false and exaggerated personal-injury claims.
Bitter arguments have broken out between insurance companies and lawyers over the extent to which claims, particularly exaggerated and false ones, are pushing up motor premiums.
Premiums have risen by 34pc in the past year, according to the Central Statistics Office, with many motorists being asked to pay double and even treble their previous premium.
Insurance companies blame high levels of court awards in personal-injury cases and dodgy claims for the premium hikes.
They also complain about inconsistent levels of court awards for similar injuries and argue that legal costs make up around 50pc of the cost of court-contested claims that are settled.
However, lawyers' bodies, such as the Law Society and the Bar Council, say the number of court awards has not risen.
They claim that undercharging in the past and under-reserving by insurers are behind the premium hikes.
The director-general of the Law Society Ken Murphy said the regulatory body was determined to purse claims harvesters as a matter of public policy and because such activities were unfair on the majority of solicitors who comply with advertising regulations.
The society has hired private detectives to probe lawyers suspected of buying claims in bulk from claims-harvesting websites.
Barristers and solicitors face stringent advertising regulations aimed at preventing 'ambulance-chasing' and the development of US-style 'claims factories'.
Lawyers here are banned from placing ads in locations such as hospitals or funeral homes.
However, the European Commission has warned the Government that its strict ban could breach the EU's Services Directive.
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Mr Murphy said: "The investigations are at an advanced stage and solicitors who are found in breach of regulations may be referred to the Solicitors' Disciplinary Tribunal or to the High Court, which may strike off solicitors who are found to be in breach of the law's strict policy ban on claims harvesting."
Mr Murphy said it was not straightforward to identify who is behind the websites. Some of them are registered overseas.
He added: "What is separate and more sinister is those persons who are not solicitors who are behind these websites and hoovering up claims with a view to selling them in bulk to solicitors."
Mr Murphy dismissed suggestions that the Law Society should put in place processes to force solicitors to assess whether claims cases are genuine before they are taken on.
He said: "Even two seconds of analysis will reveal that to be an absurd proposition. The society has no right or power to interfere with the administration of justice.
"That is the preserve of judges and the courts who assess the evidence, hearing it from both sides, and reach conclusions accordingly."