Sixty people have been convicted or pleaded guilty to being involved in one of the country's largest "crash-for cash" scams.
The fraud was so prevalent that people living in Derwentside, County Durham, where the main players behind the scam were based, had to pay up to £100 extra for their car insurance.
Police uncovered the scale of the fraud while investigating the activities of members of the Wright family, from Burnhope, who came to national prominence in 2009 when two local streets they had named after themselves were changed by officers to try to bolster public confidence.
Concerns over local organised crime led to a major investigation, named Operation Nacho, assisted by the Insurance Fraud Bureau and other agencies. They looked at 1,800 accidents handled by two particular firms and swiftly identified 261 that looked suspicious. Detectives suspected some were fictitious, some staged and others vastly exaggerated.
They identified 25 accidents considered to have the highest impact on the public, both financially and in terms of suspected organised crime involvement, and these were selected for detailed investigation. Those 25 accidents alone resulted in more than £514,000 being obtained for the claimants. The real figure was estimated to be more than £3m.
A series of trials involving 70 defendants began last year at Newcastle crown court, with 60 people convicted or pleading guilty to being involved. Seven were members of the Wright family.
Judge Roger Thorn has lifted an order that prevented the media from reporting any of the proceedings.
Key players included Paul Jonathan Wright, known as Jonty, 40, who ran PJ Autos, a recovery, storage and vehicle hire business. He is yet to be sentenced for his part in the scam, which involved making false claims for storing damaged cars and hiring out replacement vehicles at up to £200 a day.
Also involved was his older brother Alan Wright, 49, who was jailed for four years after a trial last year. A police source described him as the head of the family, and he was found to have had four fake crashes within 10 months.
Another family member bought an Audi with 112,000 miles on the clock, staged an accident in it near his home, and when he made a claim after apparently writing it off, its mileage had dropped to 37,000, making it much more valuable. The claimant also falsely claimed to have suffered whiplash, the source said.
Investigators used a forensic engineer to prove another crash between a lorry and a car in Burnhope could not have happened as was fraudulently claimed.
"We didn't just come across this activity. It was as a result of our communities telling us that organised crime groups were making their lives difficult," said Chief Superintendent Rob Coulson. "We acted on their information and used intelligence-led policing to take appropriate action as part of a larger operation against organised crime.
"This fraud is affecting every honest law-abiding car insurance holder. It's not just a local issue. We believe this to be a nationwide issue which needs to be tackled robustly.
"In Derwentside car insurance premiums have increased well in excess of the national average, with motorists typically paying an extra £100 a year. This is an area with limited employment opportunities where many people have to travel out of the area to find work.
"They need their cars, yet they are hit with higher-than-average car insurance premiums. This is how criminal activity has a real impact on the wellbeing of a community."
Ben Fletcher, director of the Insurance Fraud Bureau (IFB), said: "This was part of a major joint investigation by Durham police and the IFB into an organised scam which could have cost the insurance industry millions of pounds. Convictions send a clear message – insurance fraud is not a victimless crime, and the industry, police and justice system will vigorously pursue convictions against those involved.
"Insurance fraud, particularly the crash-for-cash phenomenon, is antisocial. The criminal gangs organising these scams use the proceeds of insurance fraud to fund other forms of serious crime. By locking the perpetrators up, we minimise genuine threats to our society."
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