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70 firms cashing in on compensation cases are struck off by watchdog.
Ambulance-chasing claims firms are preying on victims of crime, road accidents and financial mis-selling by cashing in on hundreds of millions of pounds worth of compensation. More than 70 claims businesses have been struck off or suspended this year after breaching compensation rules in this boom industry, which has mushroomed from 500 companies to 2,300 in the past 18 months.
In the worst cases, cowboy companies have unfairly taken compensation from the pockets of victims of personal injury and violent crime, while others have staged road accidents to make bogus claims. Some of the more unscrupulous companies have tried to cash in on the recession by sending teams of sellers to housing estates to trawl for new claims.
There has been a rise in unscrupulous tactics, some of which include illegal "cold calling", combing newspaper reports for injuries, trawling hospital casualty departments, producing misleading ads, and selling compensation claims on to solicitors.
Many of the victims end up with reduced or little compensation after they have paid fees to the companies. Others are vulnerable to exploitation, not realising that a claim for compensation to the Criminal Injuries Compensation Authority is free and requires no assistance.