Paul Havert had suffered a work-related wrist injury and submitted a claim for approximately £200,000 against his employer, a customer of AXA Commercial Lines and Personal Intermediary, arguing that his injuries would prevent him from returning to his trade as a bricklayer.
On the grounds that he had suffered a genuine injury and in light of submissions that Havert’s family were suffering financial hardship and were in arrears with their mortgage payments, AXA made prompt interim payments of £30,000.
However, at the civil trial, District Judge Stapely, sitting at Middlesbrough County Court, awarded damages of only £40,661. This was on the basis that Havert had indeed suffered a genuine injury but the judge did not accept Havert’s account in relation to three issues, namely his pre-accident earnings, his post-accident earnings and his post-accident working hours.
District Judge Stapely ordered the outstanding settlement amount of nearly £10,000 to be paid to the Court pending an Inland Revenue investigation and Havert’s costs were also reduced by 50%, the penalty falling on his solicitors and counsel.
AXA subsequently brought contempt of court proceedings against Havert for lying under oath about his past and current financial conditions as he sought to secure an inflated, fraudulent settlement.
Prior to the contempt trial, due to be heard by the Honourable Mr Justice Males on 13 January 2015, Havert admitted contempt (five minutes prior to commencement of the hearing) for failing to disclose earnings from other employment in the original civil trial. More specifically, he had submitted a witness statement on 1 May 2013 stating that he was only earning £100 a week whereas bank statements showed receipts of over £33,000 between 6 December 2012 and 31 May 2013.
Prior to sentencing, Mr Justice Males warned Havert that “he should have no complaint” if given a custodial sentence and on sentencing him to six months, suspended for two years, he was escaping jail “by the merest whisker”.
It was further ruled that AXA may apply to the Court to recover the balance of the settlement originally awarded to Havert (£9,834.29) in consideration of the cost accrued by the insurer in Havert’s delay in admitting his guilt.
Although this is just one victory in the fight against fraud it is important that AXA and all other insurers pursue and prosecute fraud wherever it is attempted.
Havert had attempted to execute a significant fraud against us and our determination to protect our shareholders and honest customers from the cost of fraud should send out a clear message to anyone who seeks to defraud us either systematically or by inflating a genuine claim, as was the case here.
The industry’s fight against fraud is really building up a head of steam and it would appear that we are beginning to secure real support from the justice system in our endeavours to prosecute these fraudsters. In addition, we have the continuing great work of the Insurance Fraud Enforcement Department, the Insurance Fraud Bureau and the Insurance Fraud Register which now has the names of over 2,000 known fraudsters on its systems.
The successful prosecution of Havert follows the recent ground-breaking private prosecution that AXA brought against Paul Gustar who had attempted to defraud the insurer out of £100,000 again, via a personal injury claim.