18 March 2015

Fraud - how to protect yourself and your kit

By Performance
Woman photographing sunset
As part of your business activities, you may be approached from time-to-time by persons wishing to either hire your kit, your services, or both.

Most of these will be genuine requests, but occasionally you may have one that just doesn’t “ring true”.  Fraudsters can use a number of ways to acquire your kit, and here are just a couple of different approaches we have become aware of at Performance over the years.

FRAUD # 1 – the up-front hirer

The first, and most common, approach involves a fraudster contacting you to hire your equipment as a “dry hire” (without any personnel).  They may sound knowledgeable, spin a good yarn and tell you a little about what they are doing, but usually not in great detail.  Answers to questions such as “where are you shooting” may be met with “London”, or “down South”, “Up North” or something equally as vague.

They will happily pay up front for the kit hire, provide documentation up front to show who they are,  and will arrange the insurance for the kit up front.  All good  so far…   Occasionally, they may change some of the details at the last minute (increasing the amount of kit, or changing who/where to collect the kit), although not always.  Once they have your kit, then that will probably be the last you see of it.

FRAUD # 2 – the Producer

The second scam we are aware of is where a “Producer” contacts you to work on their production.  They usually ask you if they have certain equipment, and offer to pay more for you to hire additional pieces of kit if you can source it for the “Producer”.   This enables them to “legitimately” hire the equipment from a hire company, without having to show their face.

This approach is usually the more violent of the two, as this involves the “Producer” physically separating you from the kit.  This is achieved by either sending a “crew vehicle” round to pick you up (which you are subsequently chucked out of, minus the kit), or by sending a cab round which drops you “on location” where you are robbed.

Prevention is better than cure

To guard against both of these scams, our recommendation as film and media brokers has always been to ask questions of any hirer.  The legitimate one will see this as a sign of interest, and won’t mind you asking, as they are not (or should not be) difficult questions for them to answer.  Remember, it’s your kit – you have every right to ask!

Also, ask for references and contact those references.  Do this through independent means, and not via any numbers the “hirer” provides.  The internet can be a great source for phone numbers (as can LinkedIn, Facebook, etc, etc).

Other checks you can make include confirming  with the location that it has been booked for the project.  You can also ask for a landline from the hirer and check this is legitimate.  Ask who else is working on the project? Anyone you can speak to?  Above all, if you are not 100% happy, DO NOT HIRE YOUR KIT OUT.

If you decide to proceed, then there are certain things you should have in place to protect you and to gather more information from the hirer.

Firstly, you will need to check with your insurance advisor that you are able to hire out your kit in this way and that they can offer a “Fraudulent Hire Extension”.  We would then recommend that your Business Description on your insurance policy is altered to include “Equipment Hire” as a safeguard.  Generally, this doesn’t cost a penny, but could save you a lot of problems further down the line!

The “Fraudulent Hire Extension” insures the loss of your equipment if someone hires it from you under false pretences with a view to stealing it.  Again, certain measures are recommended, which are usually that you obtain two forms of ID from the hirer, one of which should be photographic (a utility bill within the last 3 months and a copy of their driver’s licence or passport are usually sufficient for this).

From experience, we have found that some fraudsters provide either legitimate documents – in the sense that they have been issued by DVLA or the Passport Office – or some provide very good (and sometimes very poor) fakes.  Ask to see the originals, not just scanned or emailed copies…and all ID should be checked against the person picking up the kit!

As utility bills are easy to scan and fake, do check directly with the utility company (if you tell them that the bill has been presented as ID for a hire, they are more likely to confirm if the bill is genuine or not , than quote the Data Protection Act to you!), or ask your insurance broker for advice.

You should also draw up a hire agreement between the two of you.  We strongly recommend taking legal advice on any contract as this can take many forms, but as a minimum, we believe this should state:

The parties to the agreement (you and your friend)

  • The kit being hired
  • The value of the kit (replacement cost as new) being hired
  • The duration of the hire
  • That the hirer is responsible for effecting insurance for the full replacement cost of the kit from xxx (e.g. the time it leaves your portals or the time it is delivered to them) to xxx (e.g. the time it is returned to your premises, or the time it is collected by you)
  • What will happen if the kit is damaged (are you going to charge for your own loss of hire?  Loss of use?  How much will this be?)  – It is usual for the daily hire rate to be charged in this event, although some hire companies cap this to a maximum of 13 weeks in total.
  • This agreement should be printed on your letterhead, and signed and dated by both parties.
  • The hirer should always be responsible for insuring your kit themselves whilst they use it and provide evidence of this from a reputable source.  Again, check this with the insurance company, but do remember that, as the insurance is there to protect the hirer (not you), evidence of insurance is not proof of ID.

Remember, if you hire your kit out, your insurance policy should also include Products Liability cover.  This is usually bundled in with Public Liability cover (do check!) but differs, in that it protects you should your kit cause injury to a Third Party or damage their property.  It is very important that you are covered for this eventuality, as the costs to settle these types of claims can be expensive.

Thankfully, most hires go without incident.  It is more common for us to see Accidental Damage claims from hires than instances of Fraud.   Keeping on your toes throughout the whole process is the key here, and taking note of that “gut feeling” appears to be equally important.

Check with your film and media insurance specialist if you have any doubts, as they may well be able to give you some more practical tips for keeping yourself and your kit safe, which is ultimately what everyone wants.

For any issues of fraud, contact Action Fraud  (0300 123 2040).

Above all else, do not put yourself or anyone working for you in danger, and feel free to speak to Performance if you have any concerns.