The Accident Group
| Industry | Claims management company |
|---|---|
| Predecessor | Motorlaw |
| Founded | May 2003 |
| Founder | Mark Langford |
The Accident Group was a Manchester-based personal injury claims management company that went into administration in May 2003. The firm gained notoriety for informing its 2,400 workers of their redundancy by text message, which, according to BBC reports, led to the firm's offices being emptied of computer equipment by disgruntled staff.[1] The business was placed in to administration the day before staff were due their monthly salaries.
Formation, business model
Mark Langford (29 May 1964 - 9 April 2007) trained to become a solicitor. However, after failing to qualify he started Motorlaw before launching The Accident Group in 1999, and placed Gary Hoddes as Managing Director. Hoddes then went on to place members of his own family in Director positions, including Phil Hoddes (brother) [Sales Director], Jackie Brennan (sister) [Operations], Mike Boxen, Paul Boxen and Maria Berry. Many of these directors had been involved in the collapse of disgraced kitchen manufacturer Farouche Kitchens.
Administration
In light of a change in the law, the model on which the Accident Group operated began to fail. Legal costs undertaken by the claimant were moved from claimable against the other party, to payable by the claimant. This meant that the amount of money paid to claimants dramatically fell, whilst the money payable to solicitors undertaking the claims were too high.
Secondly, the number of false claims filed by claimants began to cause concern to investors. A BBC One program, The Man That Made Accidents Happen, interviewed the former Accident Group special investigator Paul Stott. Mr Stott focused on the practice of multiple claims - the practice in which a single claimant would sometimes make claims for many different accidents. He also found that some salespeople also made many multiple claims for themselves. Stott claimed that one couple who both worked for the company and had made 33 claims for themselves, of which nine were accepted by the company, and made a further 40 claims for people living in their street, and another 68 claims on two addresses nearby where their friends lived: of the total, 24 were accepted by the Accident Group. Stott said that many claims went through, defeating the checking procedures the company had put into place, saying: "Working on the figures that I had to hand at the time, of the totally ridiculous claims, 30 per cent went through."[2]
After administrators were called in, notoriously most of the firm's 2,400 employees were dismissed via SMS text message sent by Langford[3][4] which read:
Urgent. Unfortunately salaries not paid. Please do not contact office. Full details to follow later today.[5]
Parent group Amulet Group, which was also put into administration in May 2003, said its subsidiary The Accident Group had to cease trading because it could not sustain its "continual battles with the insurance industry" and after "the sudden failure of a banking partner to support the company". The administrators Price Waterhouse Coopers, later blamed Accident Group's "lower than expected claims success rate" for the financial difficulties, which they say "resulted in increased insurance premiums on new business and retrospective claims from the underwriters.".[6]
The closure of the business may have been a shock to staff but not to the Langfords. Knowing that the business was close to folding they sequestered £20m in to the offshore account held in the name of Debbie Langford. Staff were informed of the closure on payday and the salary run, approx £5m, did not go through.
Staff, who were not allowed to join a union,[7] and who didn't receive their final salaries or a follow-up email (as promised in the infamous text message), ransacked the Manchester head office and the Liverpool office and carried off computers and other equipment.[8][9]
Death of Mark Campion Langford
In June 2000, Langford was convicted of careless driving after a 73-year-old pensioner (ex serviceman), William Thornley, was knocked down and killed by Langford's Ferrari 355 F1 Spider close to Old Trafford football stadium in November 1998. Langford had to be cut free from the wreckage of the convertible, and sustained a broken thumb and finger. He was, however, found not guilty of causing death by dangerous driving,[10] despite only having his license back for six months from a previous drunk driving ban.[11]
Langford fled to Spain after the company's collapse. Although having an estimated fortune of between £40m and £75m, Langford had previously been served with a High Court bankruptcy writ aboard his £1.5million 80 ft yacht Mermaid’s Whisper in Puerto Banús. Langford had adjourned the hearing until 1 May 2007 after claiming he was suffering from “severe mental illness leading to manic depression." In his absence he was being sought by HM Customs and Excise for £4.1 million in unpaid taxes, and the Department of Trade and Industry was seeking to disqualify him as a company director.[10]
Langford died in an accident when his Opel Corsa left the road in an accident in Marbella, Spain on 9 April 2007.[12] He and his wife were said to be separated at the time of his death at the wheel of the rented Opel Corsa, which he drove as he had had his assets frozen (including luxury and sports cars) by liquidators; and had sold both his Marbella home, yacht; and had his North Rode, Cheshire home on the market for £3.5m.[13] To this day [When?], millions remain unaccounted for, and investigations continue.
References
- ↑ "Accident Group boss 'gobsmacked'". BBC News Online. BBC. May 31, 2003.
- ↑ Pip Clothier (July 30, 2003). "Accident Group fraud investigator speaks out". BBC News Online. BBC.
- ↑ This disaster was no Accident - Daily Telegraph report
- ↑ Firm adds insult to personal injury as it sacks workers by text message - report in The Guardian
- ↑ Insurance pirate of the Mediterranean: the extraordinary life of Mark Langford - Profile in The Independent
- ↑ "Bust company sacks workers by text". BBC News Online. BBC. May 30, 2003.
- ↑ Meet Mark Langford, £40 million boss behind 'text message' sackings company|7Jun03|Socialist Worker
- ↑ Accident Group Finished, Two and a half thousand workers lose jobs overnight
- ↑ CommLog: Points Of Interest
- 1 2 Text message boss killed in crash - Report on death on BBC News
- ↑ Stitching Bastards
- ↑ "Accident Group boss killed in car crash". London: Daily Telegraph. April 11, 2007. Archived from the original on 2007-08-23. Retrieved 24 August 2013.
- ↑ Russell, Andy (9 May 2007). "Crash kills textsacker tycoon". The Sun. London.