Fraud Charter: No progress on the LiP Portal for months

Susan Brown, partner and mediator at Medco has claimed that the Litigants in Person (LiP) Portal, a staple of the future of small claims, has seen little progress in recent months.

At the Insurance Times Fraud Charter in early November, Brown was apprehensive about talking to the group about the portal as she simply said: “It has not moved.”

Insurers, claimant lawyers and regulatory bodies gathered at the In and Out Club in London’s Piccadilly to discuss the future of fraud.

“We (Medco, MIB and MoJ) had a lock-in at the end of July/beginning of August,” Brown said. ”We came out of that with some questions that the MoJ civil servants were going to take back to the ministers.

“As far as I know, if the civil servants did take the questions to the ministers, the ministers haven’t answered them yet.”

This rippled a shock in the room as the government seem to be quickly running out of time to have the portal built if it is going to go through the six-month testing period before the April 2020 deadline.

IT advance

But while Medco and the MIB wait to hear back from ministers, there has been some progress going on in the background.

“In terms of the IT build,” said Brown, “there was the tender process which has been steadily going on in the background.”

She added that another lock-in was due in December.

“But Medco has been asked to consider the different ways it will be able to access medical reports as this is really key for how this process will work. We spoke about this at the lock-in without really landing anywhere. There are so many issues that stem just from that, which need answers that we just don’t have.”

Brown says the build will be “agile” and “not as complicated as last time.”

But she says that “key decisions need to be made and we have less than a year to build it if we want to start testing in October 2019.”

CMC Regulation

Barbara Kubis-Labiak, technical specialist at the FCA spoke about plans to regulate claims management companies (CMCs) once it takes over regulation from the MoJ in April 2019.

“We want to make CMCs trusted providers of high-quality and valuable service to consumers,” she said.

“We have published our first consultation paper, of what we propose to introduce when regulating CMCs.”

One major change Kubis-Labiak outlined was the introduction of regulating Scottish CMCs, something that is not done at the moment.

“We will introduce quite robust regulations of CMCs. We will not allow them to be operating as freely as some of them have been so far.”

When asked what measures the FCA will take to really change the way CMCs operate, she said: “One thing we are hoping to introduce is making recorded calls mandatory for CMCS.

“We would like it if CMCs had to record every phone call for records.”

Paul Holmes, partner at DWF raised concerns about the investigative resources that will be made available to the FCA to catch these bad CMCs who might be regulated and approved by the FCA, but are still carrying out illegal activity.

Kubis-Labiak responded: “It is a valid concern, we are working with many different bodies to try and be as prepared as we possibly can, with the resources we have at the moment.”

Mark Allen, manager of fraud and financial crime at the ABI asked what level of monitoring the FCA plans to carry out.

“It is something we have to decide in the future when we know how much resource we have,” Kubis-Labiak said.

As well as the first consultation paper, the FCA released its list of fees for regulation. And Donna Scully, director at Carpenters Group felt they were “very high” and could act as a deterrent for smaller CMCs to seek regulation.

Exaggerated claims

Stephen Dalton, head of intelligence at the Insurance Fraud Bureau (IFB) presented findings from its strategic threat assessment and told the table what he felt the biggest threats were.

“In our tier one band, we felt that data theft and data phishing were the biggest threats,” he said.

Among others, it was very much the same as has been reported before. He listed exaggerated claims and application fraud as a big challenge ahead.

IFB director, Ben Fletcher has said that opportunistic fraud such as those exaggerated claims and fundamental dishonesty are a bigger threat to the industry than organised crimes such as crash 4 cash and ghost broking.

Looking ahead

The meeting was rounded off with a quick chat on what the group thought we could expect in 2019.

Scully was focussed on the LiP Portal and how that was going to progress, something she will certainly be keen on finding out at the next Fraud Charter in March.

Dalton felt validating identity across the whole process of insurance will be a challenge for the industry.

“It is within the whole activity. Thinking about the application, ‘who is using that service?’ but these fraudsters are coming up with very good, effective ways of taking identity.”

Nick Kelsall, fraud manager at Allianz suspects casualty fraud to continue.

“Especially exaggeration. We are still seeing a lot of that and doing our best to get on top of it.

“But I also think now there will be a lot of stuff around data, it has been going for a while now but we have GDPR. Think we could see some organised activity around that, with fraudsters blackmailing organisations.”

These will be discussed at the next Fraud Charter event, due to take place in March. Let us hope to have more progress on the LiP Portal build.