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Private prosecutions

There have been discussions recently on the potential for bringing private prosecutions against those involved in staging RTAs and other types of…

There have been a flurry of discussions recently in respect of private prosecutions and the potential for bringing them against those involved in staging road traffic accidents and other types of fraud. In this article, we give consideration as to the viability of prosecuting offenders where the police are either unable or unwilling to become involved.

Procedure

Common Law provides any individual with the right to bring a private prosecution. This principle was established more than a hundred years ago and is set out in various case law since. The Prosecution of Offenders Act 1980 formalises this right in statute.

Whilst there are a number of offences which require the prior specific consent of the DPP or the Attorney General to prosecute, those which would interest an insurance company, ie, offences under the Fraud Act or Theft Act, or even potentially, offences under the Road Traffic Act do not require specific permission and as such, the procedure is relatively straight forward.

In respect of a body corporate bringing an action, the prosecution itself would need to be in the name of one of their servants or agents. The Criminal Procedure Rules 2005, Part 7.1 states that "an information" would need to be laid either by an individual authorised on their behalf, ie a senior manager of the company, or their solicitor or Counsel. The laying of the “information”, as the procedure is known involves setting out basic prescribed information, including the name of the Defendant, his address, the charge, the date of the offence and the place the offence was committed.

The "information" should then be sent to the Magistrates Court Clerk (the Clerk to the Justices) and providing all is in order, a Summons will be issued. Once issued the Summons will usually be sent to the Defendant at the last known address by first class post, whereupon it is deemed served. The Summons will contain a date for the Defendant to attend Court and should he fail to do so, the prosecutor, may apply for a warrant for the Defendant’s arrest. This of course has a benefit over any civil action as the fraudster will have no option but to attend to face the allegations.

It is usual at this first stage for either a short adjournment or for the Defendant to indicate his plea. As fraud offences are triable "either way" that is to say they may be heard by either the Magistrates Court (summarily) or in the Crown Court (on indictment) a decision will then be made as to whether the matter is suitable to be tried at the Magistrates or Crown Court. Both the prosecution and the Defence have opportunity to provide representations. If the Court are willing to try the matter summarily then the final decision will rest with the Defendant who may elect trial at Crown Court (before a jury) if he so chooses. There are of course numerous advantages and pitfalls of the case being heard in either Court.

If a not guilty plea is entered and the Magistrates Court retain jurisdiction, the matter will be adjourned for pre trial review and later for trial. If the Crown Court is deemed appropriate or an election has taken place by the Defendant the matter will be adjourned for a Committal Hearing, following which the case will be transferred to the Crown Court for a Plea and Case Management Hearing.

As with any criminal case, the Prosecution will need meet the criminal burden of proof. If the Defendant is convicted (or pleads guilty), sentence will follow. The sentence will of course depend upon the particular offences taking into account any mitigation and/or aggravating factors.

Offences

Prosecuting the correct offences is also an important issue. The Fraud Act 2006, which came into force in January 2007 provides for three potential offences which would likely form the mainstay of any private prosecutions against insurance fraudsters. The relevant offences are as follows:

  • Fraud by false representation.
  • Fraud by failing to disclose information.
  • Fraud by abuse of position.

The first of the three is likely to be the most significant and could be utilised where the Claimant stated that there was an accident which in fact turns out to be a complete fallacy or where a bogus passenger makes a claim and the prosecution can show he was not in the vehicle.

There are other offences which could also be borne in mind. In particular, perjury, and attempting to pervert the course of justice. Consideration should also be given to the relevant Road Traffic Offences such as dangerous driving or driving without due care and attention. These offences could be additional counts brought against, for example, a driver who can be proven to have been behind the wheel in an induced "slam on" type collision. The former offence carries a guideline custodial sentence with a maximum of two years imprisonment. One advantage of bringing a conviction for dangerous driving would be that a mandatory 12 month disqualification from driving would follow.

Potential Sentence

All of the Fraud Act offences are either way and as such, can be tried by either the Crown Court or the Magistrates. The maximum sentence that the Magistrates are able to pass is six months for one offence and a total of twelve months for two offences.

If the matter is heard at the Crown Court, the technical maximum sentence for the first of the three offences referred to above is 10 years imprisonment. The level and extent of the sentence would again depend upon the aggravating factors, the value of the fraud and any mitigating factors that the Defence can show.

Risk and Costs

Potential "would be" private prosecutors are likely to be concerned as to the risks of being unsuccessful and the extent to which costs are recoverable from either side. In the event of the Prosecution being unsuccessful there is a risk of costs being awarded against a prosecutor, however this is unlikely to happen where a case is conducted carefully, diligently and where it can be shown that there is a case to answer by the Defendant. In these circumstances the Defendant (assuming he is not legally aided) would be likely to recover his costs from central funds as opposed to the prosecutor. In the event the Prosecution is successful the Prosecutor may seek his costs from the Defendant (where he has the means to pay) or alternatively, in respect of either way or indictable offences, from central funds. Reasonable investigation costs may also be sought.

There are, of course, a number of other considerations that should be borne in mind. Firstly, the public perception of the Insurance industry may have some bearing particularly where the case is to be heard before a Jury in the Crown Court. The Prosecutor would need also ensure that the CPS guidelines for bringing a case, are complied with, otherwise the Prosecution could be at risk of being taken over (and even potentially discontinued) by the Crown Prosecution Service. As such it would be an advantage to consult both the local police constabulary and the area's Chief Crown Prosecutor at the earliest stage to ensure the prosecution would not interfere with any ongoing investigations or proceedings.

Conclusion

Private prosecutions are a powerful weapon in the arsenal of Insurers in the fight against insurance fraud. Whilst any prosecution would have to be considered very carefully on its own particular facts, and the evidence dealt with in accordance with the guidelines of the particular court in which it was to be heard, in the right cases this mechanism allows Insurers to turn the tables on Fraudsters in a way that few will have anticipated. Where convictions are obtained the benefit to insurance companies, the publicity won and the message that it would convey to fraudsters would likely to be a key ingredient in the decision making process.