I've worked for insurance companies dopper, they'll tell you any old crap mate. If they told me it was night time, I'd look out the window to check.
The registered keeper isn't necessarily the owner of the vehicle, and it's not illegal to register a vehicle in your name if you're not the owner.
People do it all the time with company cars... The company actually owns the car, but it's registered in the employee's name. i.e. the Employee is the registered keeper on the V5, but the company he works for is actually the owner of the vehicle.
The guys got a choice... he can pay up and get his dads car back, which I'd suggest he does or I suppose technically since the bailiffs didn't have lawful authority from the courts or the vehicle owner to take the vehicle, he could call the police and report it as stolen