Fraud in Scotland – is there a storm on the horizon?

In Scotland, the introduction of Qualified One Way Costs Shifting (QOCS) together with the economic downturn resulting from the COVID-19 pandemic, has arguably created fertile ground for an increase in fabricated, misrepresented and exaggerated claims. Ongoing vigilance is therefore vital.

The introduction of QOCS

Legislation introducing the well-known concept of QOCS to Scotland received Royal Assent in 2018 and should have been introduced in spring of this year. However, the timetable has been impacted by COVID-19. It was hoped that the final rules would be drafted and implemented by the end of this year but it remains uncertain.

QOCS will change the way that cases are litigated in Scotland. Even if the pursuer is unsuccessful, they will not be liable to pay expenses/costs. There will be limited exceptions, one of which includes fraud. In terms of the Civil Litigation (Expenses and Group Proceedings) (Scotland) Act 2018, the onus will be on the defender to show that a pursuer has made a “fraudulent representation” or has otherwise “acted fraudulently” in connection with the claim or proceedings.

However, unlike in England and Wales, Scotland has no statutory definition for “fraudulent representation” or “acted fraudulently”. We therefore face a legal landscape that is likely to be shaped by different approaches being taken by the various Sheriff Courts until the highest courts (carrying authoritative weight) provide guidance. This of course, could take several years.

The impact of COVID-19

COVID-19 has without doubt disrupted the economy (north and south of the border) and as previous economic downturns have shown; one consequence is the opportunity and motivation to pursue fraud.

COVID-19 has not only impacted upon the introduction of QOCS in Scotland, many of our courts simply had to close their doors and only deal with the most urgent civil cases (usually those approaching timebar). This has resulted in a backlog in cases.

It certainly appears that there have been a number of cases approaching timebar raised within the last few months while liability is still being investigated, some of which prompt concern in relation to their veracity.

In terms of investigating new claims, the restrictions in place during lockdown and subsequent measures have potentially blurred traditional key fraud indicators. For example, failure to obtain immediate medical attention. It has also impacted some aspects of investigation, such as taking statements and instructing surveillance.

There will undoubtedly be delays resulting from the pandemic, meaning that for a number of cases that haven’t settled, it may be at least four or five years from the date of the accident until the case is heard in court. In those circumstances, documents and witnesses may not be as accessible and memories will almost certainly have faded, which can cause particular difficulty in a system that requires evidence to be taken from witnesses on the stand as opposed to lodging written witness statements. Alternatively, some evidence may be taken virtually, which in itself presents difficulties such a testing witness credibility.


Moving forward, it will be crucial for insurers, companies and individuals to remain vigilant to the potential for an increase in fraudulent claims. Our courts will have to consider what was reasonable in the circumstances at the time and consider where fabrication, misrepresentation and exaggeration has reared its head versus genuinely delayed claims. However, with the expected increase in suspicious/borderline cases on the horizon, it is hoped that the Scottish judiciary’s response will help address fraudulent claims in Scotland.

Read others items in Personal Injury Brief - November 2020