Gary Whipps, 32, of Benfleet, Essex pocketed £46,125 during the scam, which saw him forge genuine policies to inflate the premiums and promise non-existent cover.
He specialised in sourcing insurance for amusement parks; bouncy castles and soft play areas, but between January 1, 2018 and December 1, 2020 forged contracts for twenty-six clients, increasing the premiums and banking the difference.
Whipps pleaded guilty at Chelmsford Crown Court to 39 counts of fraud by false representation, after the case was referred to the City of London Police’s Insurance Fraud Enforcement Department (IFED).
He was sentenced at the same court to two years imprisonment. Confiscation proceedings to reclaim the overall loss will take place in December.
Detective Constable Surinder Ram, from the City of London Police’s Insurance Fraud Enforcement Department (IFED), said: “Insurance brokers like Whipps are meant to help their customers find the right cover for them at the best price.
“However, Whipps showed little regard for his clients, some of whom thought of him as a friend, and prioritised his own financial gain.
“Not only did Whipps make a substantial amount of money at his clients’ expense, he left some of them without the insurance cover they thought they had paid for.
“As a broker, he would have been fully aware of the financial and reputational risks he left them open to.
“Whipps has been rightfully punished for his crimes, and we’re now seeking to begin confiscation proceedings to reimburse his victims.”
Since 2016, Whipps had worked for a broker that provides insurance for businesses. It sold policies from a wholesale broker that offers insurance for other brokers to buy on behalf of their clients.
The compliance team at the wholesale broker began to suspect that Whipps had doctored its contract documents, after they were contacted by the owner of a bouncy castle hire company in Ireland who had bought an insurance policy in April, 2019 from Whipps.
They found that Whipps had edited the contract so that it incorrectly stated that the policy was valid in the Republic of Ireland.
His actions meant that, had there been an accident involving a child on the play equipment, the company would not have been covered by insurance.
Further contracts obtained by the wholesale broker showed that Whipps had increased the cost of the premiums on another 38 insurance policies that he had sold between February 2018 and June 2020.
They had been increased by values ranging from £100 to £27,286.
In one case, the owner of an amusement park in Wales bought a business insurance policy from Whipps in December 2019.
He was told by Whipps that the policy included cover for business interruption and subsequently paid a premium of £44,800.
In March 2020, when the client tried to claim for business interruption due to Covid-19 restrictions, Whipps avoided his attempts to contact him by stating that his child was ill or that he had injured his leg while chopping down a hedge.
In May, he told the client that, while the policy did not cover business interruption as a result of Covid-19, he could pretend that his property had been stolen to obtain the money another way.
The client subsequently used £235,000 of his own funds to cover the business interruption. When he contacted the wholesale broker in June, he discovered that the premium should only have cost £12,355.
Whipps was suspended from his job in June, and the wholesale broker referred the case to IFED on 9 July.
IFED’s financial investigators found that the £44,800 from the owner of the amusement park had been paid into a bank account owned by Whipps.
He was arrested on 3 November.
The Insurance Fraud Bureau (IFB) conducted checks with other insurance companies to ensure that they had not been targeted by Whipps’ activity.
Jon Radford, Head of Intelligence, Investigations & Data Services at the Insurance Fraud Bureau (IFB), said:“Whipps grossly neglected the professional standards expected of insurance brokers.
“He was trusted by so many companies to provide them with vital business cover but left them risking serious financial and legal complications just so he could line his own pockets.
“We're pleased to have supported IFED with this investigation and to see that Whipps has faced the serious consequences of his selfish actions.”
During his police interview, Whipps answered “no comment” to all questions asked.
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