A gang of fraudsters have been arrested, and it is believed they have claimed up to £8 million in false car accident claims.

The gang would disable their brake lights, and stop sharply at roundabouts causing the vehicle behind them to crash into them, putting the occupants of both vehicles at risk of injuries from the road accident.

Once the car accident had occurred, the gang members would submit hugely inflated insurance claims, often whiplash compensation claims were submitted for non-existent passengers, or they would claim for vastly exaggerated damage to their own vehicle, all off the other parties’ insurance cover.

The 'crash for cash' scam has been under investigation by the Police for three years in the Greater Manchester area leading to 25 arrests, with more expected in the near future.

The average road accident claim from this scam Police believe to be around £20,000 with hundreds of drivers around Greater Manchester and Lancashire falling victim to the scam.

Between 2001 and 2005 a group of MPs estimate around 22,500 road accident claims were as a result of the 'crash for cash' scam throughout the UK. This insurance fraud is believed to be costing the industry £1.6 billion a year, adding around £40 to the average insurance premium.