A British fraudster who made more than £17,618 ($34,591) selling phony insurance policies over Instagram has been handed a suspended prison sentence. 

Wahidullah Usmani, 22, operated as a “ghost broker” between February 2020 and January 2021, advertising invalid policies through his account @cheap_car_insurance_quotes, a court in London heard.

City of London Police’s fraud squad began investigating Usmani in early 2021 after it was contacted by a customer who had bought from the account.

Posts from the account claimed customers could “save up to 60% on every quote”. 

Investigators connected Usmani to the account after examining his mobile phone. His bank records revealed he received £2888 ($5670) for 14 falsely sold car policies, and an additional 19 payments linked to ghost broking activities were found.

Usmani pleaded guilty to charges relating to fraud, money laundering and carrying out a regulated activity without authorisation.

In addition to the 24-month suspended prison sentence, he must complete a 15-day rehabilitation program and pay £1000 ($1963) in costs. 

Fraud squad detective Phil Corcoran warned buyers to beware ghost brokers who “prioritise their own financial gain above all else”.

“Usmani enticed his victims with the offer of cheap car insurance but left them with policies that were worth less than the paper they were printed on,” he said.

“We know that the rising cost of insurance premiums means people are always looking for a cheap deal, but it’s vital to check you’re buying an insurance policy from a legitimate source. Buying a policy from a ghost broker could end up costing you a fine, points on your licence and your car being seized – not to mention having to cover the cost of a new, valid policy.”

The UK Insurance Fraud Bureau says ghost broking is a growing issue, with a 6% yearly increase in the number of people who fall victim to such scams.

“Ghost broking is widespread across social media and more people must know the signs, which is why we’re campaigning in partnership with [police] and the insurance industry to raise awareness of this important issue,” bureau intelligence and investigations manager Nicola Smith said.