New figures have been released that indicates the frequency of ‘fronting’ cases has recently been on the rise according to one industry body.
The Finance and Leasing Association states incidences of fronting are rising. Fronting, a type of motor fraud, usually involves an identity theft in order to procure motor finance or discount car insurance. Individuals with good credit or motoring records apply for the services in place of the actual driver of the car. The fraud is perpetrated by those who cannot obtain motor car insurance due to driving infractions or with poor credit scores.
Many insurers will caution parents from engaging in ‘fronting’ behaviour for their children. This is because even the cheapest car insurance quote for a young driver is much more expensive than for a driver with experience and a clean driving record. However parents are permitted to have their children under their own insurance policies if they adhere to certain regulations.
The practice is prevalent in organised crime circles, stated the FSA. Most often the identity of a motorist with a stellar driving record is stolen and used to secure motor cover from car insurance companies.
Both a driving record and a credit record are used when drivers apply for finance or for insurance. Drivers with a history of motoring offences or who are unable to procure car insurance are many times turned down by lenders due to heightened risk.
It is true that instances of ‘fronting’ has increased recently. However third quarter figures in regards to all cases of motor fraud have actually gone down recently. 2010 figures for motor fraud costs have been assessed at £3.1 million for the quarter, which is a 17.7 per cent reduction over last year’s figures.
Furthermore third quarter of 2010 saw 188 documented cases of motor fraud. Compared to the same period last year, incidences of motor fraud have dropped by 24 per cent.