How to Avoid Car Crash Debt Recovery Scams from “Not At Fault” Recovery Agents

How to Avoid Car Crash Debt Recovery Scams from “Not At Fault” Recovery Agents

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Hi, my name is Adam Stewart, Debt Collection Expert and owner of Debt Recoveries Australia.

A common scam in the motor vehicle accident repair industry these days are dodgy “not at fault” recovery agents. These agents prey on innocent “not at fault” victims of car accidents: offering to fix their car quickly, give them a replacement car and handle the whole claim on the driver’s behalf. Sounds too good to be true!

The problem is these dodgy recovery agents are then charging the at-fault party ridiculous amounts for repairs, towing, assessing, recovery fees and replacement vehicles – often inflating these prices to unreasonable amounts. In some cases, they are simply issuing demands through the courts, without proper consent of the “not at fault” driver.

Don’t sign anything before reading!

The scam can involve tow companies, where tow truck drivers will capture cars and have the driver sign an agreement, for a debt recovery agent to act on their behalf, not even making the driver aware of what they are signing.

The tow truck driver will then take the car to an affiliated crash repairer, who may also be attached to some dodgy hire car operators and lawyers.
Insurance companies, acting on behalf of the at-fault party, are then being stung with these excessive demands, often not even being advised of the demand until their insured is served with court documents.

How the “Not At Fault” Scam works

  1. A lawyer writes up an authority to act form allowing a lawyer or recovery agent to take control of the case. Once signed, they can initiate legal proceedings to recoup costs on person’s behalf even without permission.
  2. The tow truck driver or the smash repairer, makes the not at fault driver sign the contract.
  3. A kickback may be given to the towie or the repairer, for taking car there.
  4. Inflated repair costs are made to the car. Car may be kept hostage until funds are paid, either by the at-fault party or by the at-fault party.
  5. A hire car is dropped off at the not-at-fault driver’s home and told it can be used at no extra cost
  6. At-fault driver or their insurer, then slugged with inflated fees for repairs, towing, replacement car and recovery fees.

How to avoid being scammed

If you have an accident, do not admit any responsibility until the accident can be assessed. Swap your details with the other driver only and no one else. Get their name, address, email address and phone number. Get details of any witnesses.

Always call your insurer after an accident, even if it wasn’t your fault. They will advise you on what to do. Take photos or video of the damage before the car goes onto the tow truck.

Always question a “free” hire car offer. Don’t forget, most insurers will give you a hire car anyway, if it’s needed for work purposes, so check with your insurer first.

The only thing you should need to sign on the roadside is the ‘Authority to Tow’ document. Do not sign anything else. Make sure you get a picture at the scene of the tow document and the crash scene. Again, take lots of photos.

Know where your vehicle will be towed. Don’t sign any contracts or authorise repairs until you speak to the insurer

What if I have received a demand from a “Not at Fault” Recovery Agent?

The repairers and dodgy recovery agents start demanding money from the not-at-fault driver to pay the inflated costs for the repair work and replacement car. Do not ignore these demands, or they will quickly escalate to legal action, since this is what these recovery agents want.

Send your reply letter by mail and email, acknowledging the demand and advise them you are investigating it and ask them to hold off on legal proceedings and ask for a reasonable time for you to conduct this investigation. Ensure all communications are in writing and keep a record.

I’ll discuss this further in my next blog, since a lot of insurance brokers and insurers are receiving these dodgy recovery agent demands and have no idea what to do with them.

Have you experienced dealing with a “not at fault” recovery agent? What did you do? Share your experience with us.


Debt Recoveries Australia is the expert at recovering your outstanding debts without the drama. For more information, email us at or call 1300 799 511. Talk to us about your debt collection concerns via Skype at debtrecoveries.

2 Comments on “How to Avoid Car Crash Debt Recovery Scams from “Not At Fault” Recovery Agents

  1. Hi,

    My mother is a victim of the “car-napping” scam just as you described in your article.

    My mother was in an accident. She was not fully conscious and she doesn’t speak, read or write English. She was conned into this scam believing the whole time she was being assisted by her insurance company RACV.

    Long story short, she had to pay hefty fees for her car to be released.

    What are her rights? How can we make those dodgy third party repair shop accountable?

    ThNk you.


    • Hi Mike. Not much you can do after the fact as your mother probably signed their agreement, allowing them to fix her car and give her a hire car. Best option would be to appoint your own solicitor, if there is a loss you want to recover. We can help with that.

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